Economists are dialing back their expectations for U.S. economic growth this year. A survey from the National Association for Business Economics predicts GDP will grow 2.8 per cent this year — down from the group’s February prediction that it would grow 3.3 per cent. Their outlook for consumer spending and the housing market also weakened, in part because they expect oil prices to remain above $100 a barrel through 2012. In a survey that the NABE releases Monday, a panel of 41 economists also said they “remain highly concerned” about the growing federal deficit, and said that growth in the first three months of the year had been weaker than expected.
The predictions of the economists reflect the jitteriness of a public that is still recovering from the financial crisis and now getting squeezed by rising prices for gas, groceries and other household items. Retailers of all stripes are paying more for the raw materials they need to make and transport their products, such as fuel, cotton and wood pulp.