The White House has bumped up its forecast slightly for U.S. economic growth in 2005, but has left its 2006 forecast unchanged, White House spokesman Scott McClellan said Dec. 1. The economy will likely grow 3.5% this year, up from the 3.4% estimated by the Office of Management and Budget in July.
For 2006, the OMB still sees growth at 3.4% from the fourth quarter to fourth quarter. "The economy, our workers and our businesses have overcome many challenges, including the hurricanes that hit the Gulf Coast region and high energy prices," McClellan said.
The projection came after official figures showed the U.S. economy grew at a better-than-expected 4.3% annual pace in the third quarter despite the impact of hurricanes and high energy costs. The new White House forecast calls for job growth in 2006 of 176,000 per month, up from this year's expected average of 160,000 per month, revised down because of the disruptions from hurricanes Katrina and Rita.
Over the longer run, economic growth is expected to edge down gradually from 3.5% in 2005 to 3.1% in 2009 through 2011, largely due to slower growth in the working-age population and the retirement of the baby-boom generation, the report noted.
Copyright Agence France-Presse, 2005