This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Moody’s Analytics US Macro Outlook: Restarting The Engines

Moody’s Analytics, a leading independent provider of economic forecasting, today released Chief Economist Mark Zandi’s US economic outlook for February. According to “ U.S. Macro Outlook: Restarting the Engines,” fiscal austerity will continue to drag on US growth in the coming months, but monetary stimulus will ensure real US GDP growth of almost 2% through mid-2013, the average pace of growth since the recovery began.

According to the report, as the weight from fiscal austerity lifts later in the year, growth will rise to close to 3% during the second half and stay near 4% in 2014-15. Stronger growth will lead to a healthier job market and eventually a jobless rate below 6% by 2016.

“Despite recent preliminary GDP data, which shows a fall-off in growth, the US economy continues to grow at a modest pace,” Zandi said. “This resilience is comforting given the mounting weight on growth from fiscal austerity.”

The report notes that the most encouraging sign is the job market, which is averaging close to 175,000 net new jobs per month, with only the government shedding positions. Even long-struggling construction is adding jobs at a growing pace as the housing market rebounds.

Moody’s Analytics outlook also takes into account the effects of sequestration – the $1.1 trillion in across-the-board, 10-year spending cuts set to take effect March 1. If the full sequester takes effect as ordered under current law, Moody’s Analytics estimates the hit to real GDP this year will be about 0.5 percentage point. Zandi also estimates tax hikes from the fiscal cliff deal will shave 0.8 percentage point from GDP growth in 2013: 0.6 percentage point from the expiration of the payroll tax holiday, and the rest from higher tax rates on higher-income households.

The report concludes that barring an external shock, the economy should be able to hold its own until the weight begins to lift later this year.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

Chart of I:DJI
DOW 16,654.77 +369.26 2.27%
S&P 500 1,987.66 +47.15 2.43%
NASDAQ 4,812.7080 +115.1720 2.45%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs