Top economists increasingly see recession ahead

The latest: Amid bad news about job growth, housing sales and consumer confidence, more economists are predicting a recession. The National Association for Business Economics (NABE) says in a report being released today that 45 percent of the economists on its forecasting panel expect a recession this year. In September, only one in four of the economists was pessimistic enough to put the chance of a recession at 35 percent or higher.

The other view: The survey shows that 55 percent still believe the country will be able to skate by without falling into an actual downturn, typically defined as two consecutive quarters of declines in the gross domestic output, the broadest measure of economic health.

Call it a slowdown: All the analysts, however, expect growth to slow considerably this year. The forecasters on average think the gross domestic product will expand by 1.8 percent this year, which would be the weakest growth in five years. That compares with an estimate of 2.5 percent growth for 2008 made in the previous survey, in November. The new estimate is in line with a downgraded forecast from the Federal Reserve this past week.

Second-half rebound: The NABE forecast reflects the expectation the economy will grow only sluggishly or actually contract from January through June. Then it is seen starting to expand more strongly in the second half of the year. Helping accomplish that is a $168 billion federal aid plan, with its rebate checks for millions of families, and aggressive interest rate cuts from the Fed.

Jobless, inflation rates: The weaker growth will mean higher unemployment, according to the forecasters. They predict that the jobless rate for 2008 will average 5.2 percent, compared with 4.6 percent last year. The Consumer Price Index is forecast to rise by 2.5 percent, compared with last year's 4.1 percent.

Not long-lived: The panel of 47 top forecasters thinks "any recession, if it occurs, will be short and shallow," said Ellen Hughes-Cromwick, chief economist at Ford Motor Co. and NABE's current president.

ASSOCIATED PRESS