Inflation-adjusted gross domestic product will expand by 1.8 percent in 2013 and by 2.8 percent in 2014, according to the Manufacturers Alliance for Productivity and Innovation’s Quarterly Economic Forecast report. The figures show no change from MAPI’s previous November 2012 report.
However, manufacturing production is expected to show increases of 2.2 percent in 2013 and 3.6 percent in 2014. The 2013 figure is an increase from 2.0 percent and the 2014 estimate is up from 3.2 percent, compared with the November forecast.
“There are several reasons to be optimistic about continued economic growth in 2013 and 2014,” said Daniel J. Meckstroth, MAPI’s chief economist, in a written statement. “Consumer deleveraging is close to an end; there are definitive signs of improvement in the housing market, especially on the supply side; and there is moderate job growth, pent-up demand and the potential for spending that was previously postponed.”
Meckstroth warned though that business investment could be sluggish because the recessions in Europe and Japan have hurt foreign affiliate earnings and limited U.S. exports; the deceleration of growth in China, Brazil and other developing countries increases risks of a global slowdown; and there remains a level of uncertainty about federal policy and the resolution of policy deadlines.