White House cuts US economic growth forecast to 1.7%

The White House has revised down US economic growth forecast for 2011 to 1.7% but said the US will avoid slipping back into recession.

The revised forecast from the Office of Management and Budget (OMB) confirmed investor fears the previous estimate of 2.7% growth made in February was inaccurate, the BBC reports. Official data shows the US economy grew only 0.4% in Q1 and 1% in Q2, but in its mid-year fiscal budget review, the OMB said it expects the economy to improve towards the end of the year, avoiding recession. Jobs data released later today is of more concern as the OMB predicted the unemployment rate of 9.1% in July will be unchanged for August. The office warned this could still be hovering around the 9% ...