Forecasting Firm Expects U.S. Recovery To Get Under Way Soon

ByJohn S. McClenahen Add DRI/WEFA to those now expecting the U.S. recovery from recession will come sooner rather than later. Recovery could be under way next month, although it's likely to be three to six months old by the time the National Bureau of Economic Research certifies that the recovery has begun, says the Lexington, Mass.-based economic forecasting firm. "Although we expect three quarters of negative real [inflation-adjusted] GDP growth, the total peak-to-trough drop is expected to be only 0.8%, well below the average postwar decline of 2.3%," says DRI/WEFA. Its forecasters figure that GDP contracted at an annual rate of 1.1% in the third quarter of 2001 and at a 1.7% rate in the fourth quarter of last year. DRI/WEFA expects GDP to decline at a 0.5% annual rate in the current calendar quarter, but then to turn positive. It anticipates a 2.1% annual rate of growth in GDP in the second quarter of 2002, 3.2% in the third quarter and 5.4% in the fourth quarter of this year.