U.S. Q3’12 Economic Overview and Outlook

By Joseph Brusuelas for Bloomberg BRIEF Economics

Executive Summary

• Growth is tracking at 1.2 percent in the second quarter of 2012
and will struggle to reach that level in the third quarter. Sub-trend growth (2.5 percent) likely to continue through mid-2013.

• The U.S. economy is downshifting amid broadening global deceleration. Job growth near 100,000 per month with slight risk of higher unemployment rate through end of the third quarter.

• Risks to the outlook:
- External Sector: Euro zone, Middle East tensions.
- Public Policy: 2012 impact from 2013 “fiscal cliff”.
- Political Economy: U.S. Presidential election.

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