Video: U.S. Job Gains Slow as Economic Recovery Downshifts (Bloomberg)
The economy grew 5 per cent in August, figures this week are expected to show, in a bounceback that will go some way to recovering ground lost in the first half of this year.
The latest growth figures, due on Friday, come as economists are becoming gloomier about the outlook for the rest of this year. But they expect stronger growth in 2021.
Howard Archer, chief economic adviser to the Item Club, said: ‘We are looking for 5 per cent growth month-on-month in August. If we are right, this will cut the decline in economic activity from 11.7 per cent in the year to July to 7.1 per cent in the year to August.’
The Item Club is sponsored by accountant EY and uses the Treasury’s model of the economy.
A 5 per cent growth figure would be less than the 6.6 per cent month-on-month rise in July, which was itself down on the 8.7 per cent seen in June.
City and academic forecasters have steadily cut their estimates for UK gross domestic product this year while pencilling in better figures for 2021.
The research group Consensus Economics says the average forecast for 2020 has slipped from a fall of 9 per cent three months ago to 9.9 per cent a month ago to 10.1 per cent now.
But simultaneous growth projections for 2021 have risen from 6.1 per cent to 6.4 per cent to 6.5 per cent now.