Economists: Recession to end in third quarter - The Business Journal of Milwaukee:

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The committee cited consumer spending stabilizing in the firstt half of this allowing businesses to reducr costsand inventories, as well as reducing layoffd and investment spending cutbacks. In combination with the stimulus and an improvemenr in thefinancial markets, it is likely the economyh will expand in the seconcd half of the year. Bruces Kasman, committee chairman and chief economist forNew York-basec (NYSE: JPM), said the economy will returnj to growth, but not health.
“Growthu in the coming quarters is likel to gather momentum but will not prove sufficiently robust to undo much of the severe damage done to our laborf markets andpublic finances,” Kasman said in a news For the third quarter, the committee forecastx inflation-adjusted gross domestic producrt will return to positive growth, picking up to a more than 3 percenr pace by the second half of 2010. Tom economics professor at , said the committee’ds forecasts are in line with others that economistsw haveput together.
He said most believe the recession will end either in the thire quarter or fourth quarter ofthis year, with a few projectinb it won’t be until the first quarter of 2010. the committee is projectintg an end tothe three-year downturn in the housing with housing starts rising later this year and home valuea moving up modestly in 2010. “Lower prices and low mortgag e rates have greatly improved the affordabilityof homes,” Kasman “A recovery in the housin sector will be an important contributor to economic However, credit will remain tight and bank economistsx said jobs will continue to be Unemployment is expected to peak at 10 percent nationally and remain at or above 9.
5 percent through next year. Budget deficits are expected to remain wellabove $1 trillion this year and next The 13-member committee forecasts the 10-year Treasury bond yielr will stay in the 3.75 percentf to 4.25 percent range throug next year because core inflation is forecastt to fall towards 1 percent. the committee is concerned about the rising trend in federal debt and the implications for inflatio riskbeyond 2010.