Survey: Experts More Optimistic
WASHINGTON (Reuters) - Forecasters are growing more confident that the U.S. economy is on a path to recovery from the recession that began last March, according to a survey released on Sunday.
The February survey by the newsletter Blue Chip Economic Indicators showed more than 95 percent of economists expected the recession would be over by the end of March.
That was an improvement on a January poll which showed 90 percent of economists saw the recession ending in March.
In the latest survey, 42 percent of those polled thought the recession had already ended.
Forecasts for gross domestic product growth in this year's first and second quarters were also revised upward.
First-quarter GDP (news - web sites) was seen expanding by 1.6 percent in the February survey, up from January's projection of a 0.7 percent gain. The Blue Chip consensus looked for a GDP increase of 2.9 percent in the second quarter -- better than a January prediction of 2.6 percent.
Blue Chip surveyed economists on their expectations for short-term interest rates in the coming year and the result indicated that most experts believe the Federal Reserve (news - web sites) will be raising rates by the end of the year.
The group forecast that overnight interest rates would hit 2.55 percent by the end of this year -- well above the current rate of 1.75 percent.
In a separate question, the economists were asked who they thought would eventually replace Alan Greenspan (news - web sites) as chairman of the Federal Reserve. The top pick was John Taylor, a monetary economist who is currently undersecretary for international affairs at the U.S. Treasury. More than 40 percent of economists named him as Greenspan's most likely successor.
Runners-up included New York Fed President William McDonough, former U.S. Treasury Secretary Robert Rubin and Bush's economic adviser, Lawrence Lindsey.
Greenspan, who took the helm of the Fed in 1987, is currently serving a fourth, four-year term that ends in June 2004.