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Sluggish Growth Seen Into Next Year

Wall Street Journal (10/12/12) Phil Izzo

Economists in the latest Wall Street Journal forecasting survey do not expect the unemployment rate to decline much from its present 7.8% level between now and June 2013. “The general trend in the unemployment rate is lower, and this should continue to be true as long as the economy grows along the profile we project,” says Joseph LaVorgna at Deutsche Bank. “However, the cumulative five-tenths decline over the past two months appears to be overdone.” The reason for the predicted stagnation in the job market is expectations for lackluster economic growth during the rest of 2012 and into 2013. Through the first half of next year, the average forecast is for growth in gross domestic product below 2% at a seasonally adjusted annual rate.