The chief economist for the National Retail Federation said in a report released Tuesday that figures suggest “the recession is ending,” and she forecast a growing economy in the second half of 2009 despite ongoing weakness in consumer spending.
Rosalind Wells, in the group’s Retail Sales Outlook, projected real GDP growth of 2.5 to 3 percent in the last six months of the year and said the improvement will be helped by the need for rapid inventory replenishment.
Business inventories fell by $141 billion in the second quarter after falling $114 billion in the first three months of the year. “This now represents a positive for future growth as businesses will need to ramp up production in order to meet future increases in demand,” she said.
But she said retail spending, which helped fuel rapid economic growth in years past, likely will continue to show year-over-year declines through the end of this year.
Consumers “remain shell-shocked over the loss of household wealth experienced during the recession and are concentrating on rebuilding their assets and increasing their savings,” Wells said in the report.