Current Macroeconomic Outlook in the United States

Current Macroeconomic Outlook in the United States of America

Rocky “Julius” Lester

Principles of Economics SUMA11

Judith Edwards

Current Macroeconomic Outlook in the United States of America

We will discuss the current state of the economy as compared to the beginning of the year 2011 estimates. At the beginning of 2011 the overall economic outlook for the US economy was expected to see GPD growth at a rate of 3-4% for the year. The rending in 2010 saw GPD growth just under 3% for the year. Unemployment was expected to fall to a level of 9% considering the expectations of GDP. Interest rates are expected to stay at the current level of 0.0-0.25% for the Federal Funds Rate for an extended period of time. (IB Times Staff Reporter, 2011)

As of July 29th, 2011 GDP has continued to grow below esteems at a rate of 1.28% for the year. This is 1.72% below the low growth rate predicted at the beginning of the year. With event such as the earthquake in Japan and what seems to be a never ending concern for UK banks. Many economists have adjusted their prediction of the year downward by .5% for the year 2011. It is great that growth is taking place within the US economy at some level.

Currently an area of optimism would be the current jobless claims numbers that were released on August 12th, 2011. The report indicated a four month low in such claims for the US economy. Ryan Sweet, Senior Economist of Moody’s Analytics, in West Chester; commented of the report and said, "It's encouraging that claims are encouraging. It shows the market is healing, but claims are not consistent with a booming job market. There are reasons for optimism in claims. Businesses are clamping down on hiring. It will boil down to whether businesses will stick their necks out to start hiring those additional workers. It all has to do with lack of confidence." (Reuters, 2011)

In recently the consumer confidence index has plummeted after the worst two week performance since October...