Economists: Recession to end in third quarter - Wichita Business Journal:

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The committee cited consumer spending stabilizinh in the first half ofthis year, allowing businessez to reduce costs and inventories, as well as reducingv layoffs and investment spending In combination with the stimulus and an improvemenrt in the financial markets, it is likely the economy will expaned in the second half of the year. Bruce committee chairman and chief economist forNew York-based JPM), said the economy will return to but not health.
“Growth in the coming quartersa is likely to gather momentum but will not prov sufficiently robust to undo much of the severd damage done to our labor markets and public Kasman said in a news For thethird quarter, the committee forecasts inflation-adjuster gross domestic product will return to positive picking up to a more than 3 percentf pace by the second half of 2010. Tom economics professor at , said the committee’ forecasts are in line with others that economists have put He said most believe the recession will end eithedr in the third quarter or fourthn quarter ofthis year, with a few projecting it won’y be until the first quarter of 2010.
Also, the committew is projecting an end tothe three-yeard downturn in the housing market, with housingb starts rising later this year and home valuesa moving up modestly in 2010. “Lower prices and low mortgagre rates have greatly improved the affordabilithof homes,” Kasman said. “A recovery in the housing sectoe will be an important contributor toeconomic growth.” However, credit will remain tight and bank economistd said jobs will continue to be lost. Unemployment is expected to peak at 10 percentf nationally and remain at orabovwe 9.5 percent through next year. Budge t deficits are expected to remain wellabovwe $1 trillion this year and next year.
The 13-member committee forecasts the 10-year Treasury bond yield will stay inthe 3.75 percen t to 4.25 percent range throug h next year because core inflation is forecast to fall towardse 1 percent. However, the committee is concerned abou the rising trend in federal debt and the implicationss for inflation riskbeyond 2010.