The U.S. will likely emerge from its recession in the third quarter but could face a weaker-than-expected recovery, a survey of business economists shows.
Seventy-four percent of economists surveyed by the National Association for Business Economics say that the economy will start to grow in the third quarter after suffering further contraction in the current one. Government spending to free up credit markets is seen as the driving force behind any recovery.
The report comes as Wednesday marks the 100th day since President Obama's stimulus package was unveiled.
The U.S. GDP is expected to shrink at a 1.8 percent pace in the second quarter - sharply lower than the 6.1 percent contraction rate experienced during the first three months of the year, according to the NABE survey. Economists think the GDP will grow at a "subpar" rate of 1.2 percent over the second half of the year.
"While the overall tone remains soft, there are emerging signs that the economy is stabilizing," survey president Chris Varvares said in a statement. "The survey found that business economists look for the recession to end soon, but that the economic recovery is likely to be considerably more moderate than those typically experienced following steep declines."
Continued surges in unemployment – expected to reach 9.8 percent by the end of the year, according to the survey - may temper the strength of the recovery. However, employment is expected to show improvement in 2010.