Moody’s Analytics, a sister company to credit-ratings company Moody’s Investors Service, now expects real gross domestic product to increase at an annualized rate of about 2% in the second half of this year and just over 3% next year, compared with its estimate a month ago for growth of 3.5% for the second half of this year and through 2012.
The firm attributes most of the expected decline to a loss of business, investor and consumer confidence, noting the economy’s improving fundamentals such as the strengthening of business’s balance sheets and consumers’ strides in cutting household debt.
In short, a crappy economy.
Moody’s also says it predicts a 1-in-3 change of another recession within the next 12 months. The ratings agency also says the chances of any significant economic growth or job creation have “diminished substantially”.
by Stephan Tawney on August 16, 2011