By Peter Y. Hong, Los Angeles Times Staff Writer March 11, 2008
Article Summary:
UCLA economists say that the U.S. and California will shrink in the second quarter, but will not plunge into a recession, according to the quarterly UCLA Anderson Forecast released today. The report, which offers a contrarian view of the economy, predicts that GDP will dip by 0.4% in the second quarter before rebounding. A recession is defined as two consecutive quarters of negative GDP growth.
The housing market remains a big drag on the economy. But the UCLA economists attribute the growing number of foreclosures to falling home prices and higher interest rates, instead of job losses, which caused the last spike in foreclosures. The U.S. economy is expected to grow 2.5% by the end of this year.
Source: Los Angeles Times
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