Economist: Blackout Won't Unplug U.S. Economic Recovery
Jan. 13, 2005
By John S. McClenahen Last week's electrical power outage in the East and Midwest will add "a little temporary noise" to U.S. economic data but it's unlikely to have a major impact, says Maury Harris, chief U.S. economist at UBS Investment Research, ...
ByJohn S. McClenahen Last week's electrical power outage in the East and Midwest will add "a little temporary noise" to U.S. economic data but it's unlikely to have a major impact, says Maury Harris, chief U.S. economist at UBS Investment Research, New York. Harris figures that while the blackout could have affected as much as 0.3% of this quarter's economic output, the actual impact will be much less. "Not all activity was disrupted, and much of the disrupted activity will be made up with catch-up later. For example, automakers indicated they will make up for lost production in coming weeks," he says. What's more, "if anything, the data have been signaling upside risk to our forecast of 4.5% [annual rate] for third quarter real GDP growth." Bottom line: "The impact on third-quarter GDP should be miniscule," Harris says.
