IMF Lowers Growth Forecast for U.S. Economy
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The International Monetary Fund dropped its forecast for growth of the U.S. economy this year, hurt by higher oil prices and slow job creation.
The IMF said Monday that the largest economy in the world will expand 2.8 percent in 2011, down from the 3 percent forecast in January. The IMF added that the global gross domestic product will increase 4.4 percent, which matches the previous estimate.
"Recovery in the labor market remains lackluster," the IMF said. "The drag on 2011 growth from oil price increases largely offsets the boost from the Federal Reserve’s unconventional policies and from stronger net exports."
Consumer spending in the U.S., which accounts for 70 percent of overall economic activity, will constrain growth due to higher prices for food and gasoline.
The IMF said the unemployment rate will average 8.5 percent in 2011 and 7.8 percent next year.
"Job creation has recently accelerated, but the pace of improvement in the labor market remains disappointing= considering the size of the job losses during the decline," the fund said.
The IMF said Monday that the largest economy in the world will expand 2.8 percent in 2011, down from the 3 percent forecast in January. The IMF added that the global gross domestic product will increase 4.4 percent, which matches the previous estimate.
"Recovery in the labor market remains lackluster," the IMF said. "The drag on 2011 growth from oil price increases largely offsets the boost from the Federal Reserve’s unconventional policies and from stronger net exports."
Consumer spending in the U.S., which accounts for 70 percent of overall economic activity, will constrain growth due to higher prices for food and gasoline.
The IMF said the unemployment rate will average 8.5 percent in 2011 and 7.8 percent next year.
"Job creation has recently accelerated, but the pace of improvement in the labor market remains disappointing= considering the size of the job losses during the decline," the fund said.
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