U.S. Forecast May 2010

M a y 2 0 1 0

U.S. Forecast

I n s t i t u t e f o r E c o n o m i c C o m p e t i t i v e n e s s

C o l l e g e o f B u s i n e s s A d m i n i s t r a t i o n

U n i v e r s i t y o f C e n t r a l F l o r i d a

MEssAgE FroM DEAn ThoMAs L. KEon

Watch out, here they come!

It’s that time of year when thousands of students across the nation graduate from college and enter the “real world.” But what will they find when they get there?

It appears the Class of 2010 will face many challenges. On the other hand, they will also have many opportunities.

While the job market is still a bit gloomy overall, there are signs of improvement. New graduates may have to relocate, or start out in an entry-level position, but in doing so they will gain valuable experience and be better prepared for advancement when a new position arises.

New graduates also have the opportunity to take advantage of the housing market. If they are first-time buyers with no real estate to sell, it is possible that they can find many good deals on new homes or condos.

Finally and most importantly, new graduates have the opportunity to make a difference. These soon-to-be politicians, bankers, teachers, engineers and other professionals have the education and the technological tools to shape our future.

After a long road, our economy is finally starting to recover. New graduates will eventually play a large role because once we get past today, we will be depending on our leaders of tomorrow.

Sincerely,

Thomas L. KeonDean

Thomas L. Keon

T h e C o l l e g e o f B u s i n e s s A d m i n i s t r a t i o n a d v a n c e s t h e u n i v e r s i t y ’ s m i s s i o n a n d g o a l s i n p r o v i d i n g i n t e l l e c t u a l l e a d e r s h i p t h r o u g h r e s e a r c h , t e a c h i n g , a n d s e r v i c e . T h e c o l l e g e i s s t r i v i n g t o e n h a n c e g r a d u a t e p r o g r a m s , w h i l e m a i n t a i n i n g t h e s t r o n g u n d e r g r a d u a t e b a s e . T h e c o l l e g e d e l i v e r s r e s e a r c h a n d q u a l i t y b u s i n e s s e d u c a t i o n p r o g r a m s a t t h e u n d e r g r a d u a t e , m a s t e r s , d o c t o r a l , a n d e x e c u t i v e l e v e l s t o c i t i z e n s o f t h e s t a t e o f F l o r i d a a n d t o s e l e c t c l i e n t e l e n a t i o n a l l y a n d i n t e r n a t i o n a l l y.

T h e U n i v e r s i t y o f C e n t r a l F l o r i d a i s a p u b l i c , m u l t i - c a m p u s , m e t r o p o l i t a n r e s e a r c h u n i v e r s i t y, d e d i c a t e d t o s e r v i n g i t s s u r r o u n d i n g c o m m u n i t i e s w i t h t h e i r d i v e r s e a n d e x p a n d i n g p o p u l a t i o n s , t e c h n o l o g i c a l c o r r i d o r s , a n d i n t e r n a t i o n a l p a r t n e r s . T h e m i s s i o n o f t h e u n i v e r s i t y i s t o o f f e r h i g h - q u a l i t y u n d e r g r a d u a t e a n d g r a d u a t e e d u c a t i o n , s t u d e n t d e v e l o p m e n t , a n d c o n t i n u i n g e d u c a t i o n ; t o c o n d u c t r e s e a r c h a n d c r e a t i v e a c t i v i t i e s ; a n d t o p r o v i d e s e r v i c e s t h a t e n h a n c e t h e i n t e l l e c t u a l , c u l t u r a l , e n v i r o n m e n t a l , a n d e c o n o m i c d e v e l o p m e n t o f t h e m e t r o p o l i t a n r e g i o n , a d d r e s s n a t i o n a l a n d i n t e r n a t i o n a l i s s u e s i n k e y a r e a s , e s t a b l i s h U C F a s a m a j o r p r e s e n c e , a n d c o n t r i b u t e t o t h e g l o b a l c o m m u n i t y.

A B o U T U n I v E r s I T y o F C E n T r A L F Lo r I DA ( U C F )

A B o U T T h E C o L L E g E o F B U s I n E s s A D M I n I s T r AT I o n

Forecast 2010 - 2013

M a y 2 0 1 0 R e p o r t


C o l l e g e o f B u s i n e s s A d m i n i s t r a t i o n

U n i v e r s i t y o f C e n t r a l F l o r i d a

ForECAst For thE NAtIoN

Published quarterly by the Institute for Economic Competitiveness, College of Business Administration, University of Central Florida

Copyright © 2010 Institute for Economic Competitiveness. All rights reserved.

This forecast was prepared based upon assumptions reflecting the Institute for Economic Competitiveness’ judgments as of the date it bears. Actual results could vary materially from the forecast. Neither the Institute for Economic Competitiveness nor the University of Central Florida shall be held responsible as a consequence of any such variance. Unless approved by the Institute for Economic Competitiveness, the publication or distribution of this forecast and the preparation, publication or distribution of any excerpts from this forecast are prohibited.

Publications of the Institute for Economic Competitiveness are made possible by the following staff:

Dr. Sean Snaith, Director

Elaine Vogt, Administrative Assistant

Erin Garlow, Researcher

Laura Burkstrand, Researcher

Cecilia Chirinos, Researcher

Jessica Fears, Researcher

Alexandra Betrone-Harpst, Researcher

hIghlIghts oF thE 2Q 2010 U.s. ForECAst

In this quarter’s U.S. Forecast from the University of Central Florida’s Institute for Economic Competitiveness:

• The U.S. economy decelerates in the second half of 2010. Real GDP growth decelerates as consumers continue to struggle with high unemployment and low housing prices.

• Ultimately, the damage inflicted on the economies of the United States by the oil spill in the Gulf of Mexico, and on the European Union from the Greece crisis will depend upon how far each of the problems spread.

• The road to asset bubbles and inflation is paved with good intentions: The Fed should not use the Greek crisis and labor market weakness as excuses for delaying interest rate hikes.

• The expansion of the economy during 2010 will be about 2.8% as consumers are still struggling with the balance sheet fallout and the labor market scar left over from The Great Recession.

• The U.S. Dollar will continue to appreciate against the Euro for most of 2010, but will not reach parity with the Euro unless the crisis in the EU worsens.

• The U.S. economy has shed in excess of 8.3 million payroll jobs through the end of 2009. Payrolls will not reach their pre-recessions levels and those jobs will not be recovered until mid-2013.

• Is the United States set to play the hero in our own version of a Greek tragedy?

• Opposing tectonic forces in the economy are colliding. Pent-up demand from a long, difficult recession meets a trio of markets pushing in the other direction – credit, housing, and labor. The outcome of this clash will determine the economic landscape.

• The U.S. financial market reaction to the Greek crisis showed a lack of confidence in the strength of the recovery.

• Foreclosures fed by persistent unemployment continue to add to inventory, feeding a housing surplus that continues to put downward pressure on prices, which are expected to fall throughout 2010.

• Unemployment, a lagging indicator of the business cycle, will remain in the 9.7% range throughout 2010 before falling gradually to 7.8% by the end of 2013. Labor markets remain the ugly scar left over from the recession’s trauma, and this scar will be slow to fade.

hIg

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Institute for Economic Competitiveness 5

U . s . F o r E C A s t

The most recent release (2nd quarter 2010) of the Survey of Professional Forecasters by the Federal Reserve Bank of Philadelphia suggests that the 39 forecasters (including yours truly) surveyed for this publication are less than 10% convinced that a decline in real GDP will occur in the 3rd quarter of this year.

The survey asks panelists to estimate the probability that real GDP will decline in the quarter in which the survey is taken, as well as the probabilities of a decline in each of the following four quarters. The anxious index (a term coined by The New York Times reporter David Leonhard) is the probability of a decline in real GDP in the quarter after a survey is taken. In the survey taken in the 2nd quarter of 2010, the index stands at 9.81%, which means that forecasters believe there is a 9.81% chance that real GDP will decline in the 3rd quarter of 2010, down from last quarter’s anxious index of 11.62%. This value for the anxious index is the lowest since the 3rd quarter of 2006, over a year prior to the official start of this recession.

The forecasters also report just a 7.44% chance that we are currently (2nd quarter of 2010) in a recession. According to the panel, the probability that we will fall back into recession remains low throughout the remainder of 2010, making the likelihood of a double dip recession remote.

The graph below plots the historical values of the anxious index and the gray bars indicate periods of recession. The current levels of the anxious index and its sharp decline from the start of 2009 indicate the recession is over and a recovery continues in the U.S. economy.

thEANxIoUsINdEx

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The Anxious IndexProbability of Decline in Real GDP in the Following Quarter

Quarterly, 1968:Q4 to 2010:Q2

6 U.S. Forecast | May 2010


My BIg FAt tAkE oN thE grEEk CrIsIs

Just when you thought it was safe to go back into the financial waters, the Greek sovereign debt problem reached a peak that precipitated a nearly one trillion dollar rescue plan for Greece and other troubled European Union (EU) countries. The plan was put together by the EU and the International Monetary Fund (IMF). The rescue plan comes replete with painful spending cuts and domestic unrest.

The crisis is by far the biggest threat to the EU since the Euro, the common currency, was adopted. The situation in Greece and the EU as a whole raises a host of questions not only about the fate of Greece and the EU, but also about what the crisis means for the United States.

Let’s begin by discussing the genesis of the crisis which lay in the fiscal policies of Greece’s government – spending that far exceeded revenues that were being collected. The overall spending of the government, as measured as a share of GDP, was not too different from the rest of the EU. However, tax revenues as a share of GDP are much lower than the rest of the EU. Put these two things together and you have a recipe for high and unsustainable yearly budget deficits and a mounting national debt.

Greece has a poor system for tax collection, and tax evasion is rampant. This coupled with extremely generous pay for public employees and pension schemes that can begin as early as age 50, have led to a growing national debt and high yearly budget deficits.

According to the IMF, by the end of 2009 Greece’s deficit reached 13.6% of GDP and public debt had increased to 115% of GDP. These deficits are more than four times the EU specified limit for government deficits of 3% of GDP, and the debt to GDP ratio is nearly twice the EU limit of 60%.

The fiscal situation in Greece was further

Is the European Union up the river styx without a Paddle and is the Euro going to hades in a hand Basket?

complicated by the recession and a growing concern that the government of Greece would not be able to meet its obligations. This concern caused interest rates in Greece to rise, thereby making the burden of debt more difficult to bear.

This downward spiral ultimately pushed the crisis to a head and necessitated the intervention by the IMF and EU.

What does this crisis mean for the future of the European Union? Is this the end of the EU as we know it?

Fixed exchange rate regimes can fail as the result of divergent economic policies implemented by the countries that are part of the agreement. The adoption of a common currency is the ultimate fixed exchange rate regime and its continued existence is dependent on coordination of monetary and fiscal policy across the countries of the EU. Monetary policy is unified in the EU and controlled by the European Central Bank. Fiscal policy in each of the member countries is subject to the terms of the EU as listed above, but achieving those targets for budget deficits and the debt to GDP ratio is the responsibility of the individual countries’ sovereign governments.

This individual control over domestic fiscal policy has proven to be the weak link in the EU. The crisis in Greece is only recently emerging as a result of under-reporting the extent of the fiscal policies that the country was implementing. As the real extent of the fiscal imbalances came to light after the election in Greece, the crisis built to a crescendo necessitating the bailout.

This predicament is the greatest challenge the EU has faced since its inception of the single currency and there is a justifiable fear that the crisis could spread to other members of the EU. Greece and a group of countries that could potentially follow suit are being collectively referred to



inauspiciously as the PIGS – Portugal, Italy, Greece and Spain.

These countries all share some of the fiscal imbalances in the size of budget deficits and/or the size of debt that have led Greece into this crisis. However, none of the other countries has both deficits and overall debt that is as large as Greece’s.

If the EU/IMF trillion dollar grape leaf can hold this debt dolma together, then the European Union and the Euro can emerge from this crisis and perhaps a nice bowl of patsa will be all that is needed to shake off the aftermath. The Euro will continue to suffer, and its value will likely fall further towards parity with the U.S. Dollar.

If the crisis spreads beyond Greece, then this particular tragedy could end as so many others have, with the death of the hero.

PUt AwAy thE togAs, thE U.s. IsN’t goINg grEEk…yEt.

Some have used the Greek crisis to illuminate the current fiscal woes of the United States. The U.S. budget deficit has exploded to $1.5 trillion and the national debt has just exceeded the $13 trillion level. These are eye-popped figures to be sure, but are they on par with what we see in Greece?

Figures 2 and 3 depict the history and forecast of the U.S. deficit and debt as a percentage of GDP, with the current level of these same percentages for Greece also displayed on the graphs. Inspection of these graphs reveals that the U.S. is not yet in the same fiscal bind as Greece.

Figure 2. U.s. Budget deficits as a Percentage of gdP

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Current Greek Budget Defict to GDP Ratio:-15%

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U.S. Debt to GDP RatioNot Quite Greece...yet.

Current Greek Debt to GDP Ratio:115%

U.S. National Debt to GDP Ratio

Figure 3. U.s. National debt as a Percentage of gdP



The U.S. budget deficit would have to be over $2.2 trillion to match the -15% of GDP level of the Greek deficit as a share of GDP. This should not be read as a vindication or endorsement of the current stance of fiscal policy in the U.S. Just because we are not as bad off as the worst patient in the intensive care unit doesn’t mean we have a clean bill of health. We have enacted policies like health care reform that have the potential to cause future deficits to mount, while trying to fool ourselves that they will actually reduce the deficit. Deficits do matter regardless of what Dick Cheney or the current administration thinks.

The mounting national debt, that will soon surpass $13 trillion, has not yet reached the heights of the Greek national debt as a share of GDP. For the U.S. debt to GDP ratio to match that of Greece would require the current national debt to exceed $17 trillion.

So, by comparison, the U.S. national debt and budget deficit are not as severe as those of Greece. We are not currently in the same boat as that troubled nation. However, Greece is a cautionary tale of what could be in the future for the United States. The current path of fiscal policy is not sustainable. Providing social security payments for thirty years of post-retirement living, providing everyone with “unlimited” healthcare, and paying a growing cadre of government employees a guaranteed fixed benefit pension for decades after retirement simply cannot persist.

The current myth in the United States is that government can provide for its citizens, and the continued movement toward a nanny state (that includes expanded benefits, larger social safety nets, and higher taxes to pay for it all) can be achieved without any change in the quality of life and lifestyle we have been fortunate to lead in this country.

While the U.S. may not currently be in as dire of fiscal straits as Greece, the crisis in this EU country is a cautionary tale that unchecked government deficits and high levels of national debt can lead to serious and painful consequences.

gdP oUtlookthE rEACtIoN oF FINANCIAl MArkEts IN thE U.s. to thE grEEk CrIsIs IllUMINAtEs AN ECoNoMIC rECovEry stIll oN shAky lEgs

The initial reading on real GDP growth puts economic growth at 3.2% for the 1st quarter of 2010. This is a strong deceleration from the 4th quarter growth rate of 5.6%, which I have been describing as a lump in an otherwise gravy boat shaped recovery. I expect that growth will be roughly the same in the 2nd quarter of 2010. However, it has the potential to be slightly stronger as a result of the spate of bad weather that hit the U.S., pushing some 1st quarter spending into the 2nd quarter.

The second half of the year will see a deceleration of growth. The lackluster job market, continued problems in the housing market, and impaired access to credit flows that have been the hallmark of this recession are still lingering nearly a year after the end of the recession. The reaction of U.S. financial markets to the Greek crisis was a telling show of weakness of faith in the strength of the U.S. recovery.

Non-residential construction still remains anemic and the growing commercial real estate crisis also weighs down on the strength of the recovery. New data on the index of leading economic indicators show a slight decline in April, and a jump in initial claims for unemployment. This data points toward a slower second half of 2010.

Pent-up demand is a significant factor, especially after a recession as long and as deep as this recession has been. This should impart a significant boost to GDP growth going forward. The problem: significant drags are still in place on the economy, some of which we have discussed already.

These two sets of opposing economic forces are like tectonic plates that are currently colliding with each other. There are several possible outcomes



of this clash. The pent-up demand could, after rubbing against the resistance of the housing, labor, and credit markets, finally jerk free and unleash a temblor of spending. The weight of these three languishing markets could cause the pent-up demand to subduct, slide underneath their bulk, and then eventually erupt at a later point in time. Lastly, the forces could clash head on, with neither force fully dominating the other and thus the economic recovery rises slowly like a newly-formed mountain chain.

I suspect the third geologic scenario will best describe how this collision of economic forces will transpire, but the first scenario cannot be completely ruled out. I think that any surprises we see in GDP growth will likely be to the upside of the Richter scale.

I have grown more skeptical about the recovery in the labor market. If this labor market recovery does not accelerate significantly in the second half of the year, it will not bode well for the strength of the recovery into 2011 and beyond. This pessimism has led me to lower our forecast for GDP growth in the later years.

We are now calling for 2.8% growth in real GDP in 2011, 3.2% in 2012, and as the massive stimulus fully unwinds, we predict a 2.5% rate of growth for 2013. I still do not believe that a double dip recession is in the cards, despite my growing pessimism and the tumultuousness of recent global events.

CoNsUMEr sPENdINg

Alas, the poor U.S. consumer. He has been bruised and battered by the housing market, the stock market, credit markets, and labor markets. Beaten, as the saying goes, like a rented mule, the consumer remains the lynchpin of this economic recovery. If, when, and the way he recovers from these injuries will ultimately determine how the economy performs and how this recovery will play out.

We spent time in last quarter’s forecast detailing the demise of the once powerful U.S. consumer and describing the assailants, listed above, that have been fingered in the beat down of consumption. The rebound in consumption will depend in part on how quickly each of the four “thugs” can be brought to justice.

Let’s run down the “most-wanted” list one by one. First up: the housing market. Housing prices are likely to continue to fall for the rest of 2010, before they begin a prolonged and gradual recovery. The home equity ATM is not likely to be back in service for many years. The negative wealth effect of housing price declines will continue to burden the consumer for well beyond our forecast horizon of 2013.

The stock market has of course recovered a significant portion of the losses since the height of the financial crisis, but is still well below its pre-crisis levels. The recent volatility triggered by the Greek crisis does not suggest that the market has the strength to recover the remainder of the losses at the same pace we have seen in the early stages of this recovery. In fact, we expect it will be late 2014 or 2015 before markets make it back to where they were prior to this crisis. This improvement is likely to be fitful over the next several years. It will help consumption, but it will not be a major driver.

Credit markets will continue to slowly improve over the course of our forecast horizon. Consumption should also be helped by improving credit availability. However, with so many banks still on the “endangered species” list and a commercial crisis that banks still have yet to fully navigate, I think this credit flow will also be slow to resume and to stop hampering the consumer.

Finally, the labor market should continue to recover in 2010, with job creation beginning to recoup the millions of jobs lost during the recession. The pace of job growth will accelerate when we get into 2011. This will be a tremendous boost to consumption spending and should help unlock some of the pent-up demand we have been discussing.



Once the fear of losing your job is dissipated, those who have remained employed over the recession will feel more at ease with spending, and the newly (re)employed will have income to spend once again.

INvEstMENt

Investment spending is expected to continue to show strength as the recovery continues. Much of the investment growth has been driven by the inventory cycle, which is playing itself out but will be replaced by growth in other types of investment. We expect that investment in equipment and software will grow at a double digit pace of nearly 12% through the end of 2012.

Paying for this investment should not be a problem as firms cut costs and retained earnings over the course of the recession, and have stockpiled cash. For those that have to borrow, the credit markets will hamper access, but those who do get access will benefit from the cheap funds that the current low interest rate environment is offering.

Investment in computers and peripherals will be boosted by replacement cycles and the fact that these types of investments can help firms in their continued battle to grow profits by containing costs. This type of investment is expected to average growth of 16.6% through the end of 2013.

Investment in non-residential structures does not have the same strong outlook for the near term. In fact we are expecting growth to show a double digit decline through the first half of 2011. The mushrooming crisis in commercial real estate is driving this dismal outlook. There is little incentive to build additional retail or office space when the demand for existing inventory is already so poor. As the commercial mortgage crisis continues to unfold this year, financing will become even more difficult to access, leading to the snowballing of the decline in business investment in structures. Things will begin to resolve themselves, and in the second half of 2011 growth will resume. By the time we get into 2012 and 2013, growth in this

component of investment will also be in the double digits, averaging nearly 15%.

On the positive side, investment in transporta-tion equipment, thanks to the aircraft industry, started to “take-off” in the second half of last year and should continue to soar throughout our forecast horizon, with an average growth rate of 29.2%. Extremely strong double digit growth for this sector will be on tap for 2010-2012 and then there will be a deceleration in 2013 to “ just” 17.3%.

Residential fixed investment growth has been negative for four straight years. 2010 finally snaps that losing streak with growth of 6.6%. Housing starts should show strong growth from a small base in 2009, the bottom for starts. Inventories of new homes have fallen significantly, and we expect starts to accelerate significantly in 2011.

govErNMENt sPENdINg

Budget deficits have exploded over the course of this recession and financial crisis. The national debt is on the cusp of reaching $13 trillion. In the discussion of the Greek crisis earlier we touched on the subject of deficits and debt, so suffice it to say they pose a real problem and are a real threat to the economic future of the U.S.

In response to these imbalances, we expect that once 2010 is over, government spending will have to be reigned in. We expect to see spending contract through the end of 2013. Part of this will be the end of the stimulus spending, but there will also be some largely cosmetic moves to give the appearance of fiscal discipline. Do note this is before healthcare reform kicks in during 2014. This will be when this transitory austerity trend begins to reverse itself.

At the state and local levels, governments will struggle when the stimulus budgetary band-aid goes away. They will still be faced with unpleasant budgetary shortfalls that will necessitate some additional spending cuts. By 2012, state and local budgets will begin to improve and spending at this level of government will begin to grow again.



NEt ExPorts

The recession was global in nature. Around ⅔ of the world’s economies were in recession, thus both export and import growth suffered. In the second half of 2009, this trend was sharply reversed, and trade started to grow once again as the recession ended in the United States and other parts of the world. Asia, and most notably China, saw economic growth pick up. This boost from trade has persisted into the first half of 2010.

We expect trade growth to continue through the end of our forecast period, 2013. This growth will be stronger on the imports side of the trade balance in the first half of our forecast period as the economic recovery in the U.S. continues. The recent appreciation of the dollar impacts trade values (dollar value of imports go up and the dollar value of exports decline, a.k.a. the J-curve effect) before it changes trade flows. In the last two years of our forecast, the weakening dollar helps export growth above import growth, narrowing the current account deficit in those two years.

The current account deficit fell to a low of $391 billion, at an annual rate in the 2nd quarter of 2009. It has been growing wider since that time. We expect that the current account deficit will grow steadily until mid-2012, when the level peaks in the $622 billion range, before it slowly and slightly improves through 2013.

The long run trends of the dollar are not changed by these passing crises. While it seems the dollar will continue to appreciate against the Euro, it is likely to weaken against other currencies, including the Chinese currency that is long overdue for revaluation. The fiscal imbalances in the U.S. will help put the dollar back on a downward trajectory by the end of 2010, on which it will remain through 2013.

UNEMPloyMENt

Labor markets remain the ugly scar that will continue to linger for years beyond the end of the recession. It will only slowly fade, as a long-lasting reminder of the economic trauma we have endured. January data showed the unemployment rate falling to 9.7% from 10.0%, a drop that caught many by surprise. Unfortunately this was not the start of a trend, and in April the unemployment rate jumped back up to 9.9%. Job creation continues to be elusive and we expect that the unemployment rate will hover around 9.7% for all of 2010.

Underemployment (U-6) is an even bigger problem, standing at 17.1% for April. A more troubling trend is that this measure has been rising during the first four months of 2010. This slack in the labor market will be used up before many firms are forced to go out and make new payroll hires. As job creation resumes, many who dropped out of the labor force will re-enter it, and this will keep the headline unemployment rate elevated.

When do things start to get better? 2011 will be the start of a long and protracted decline in the unemployment rate. Unemployment will average 8.6% in 2012, a fact which ensures that, despite the recovery being 2 ½ years old, the economy will still be a major issue in the presidential election that year.

It will be many years before we see the unemployment rate fall into a range that could be considered consistent with a full employment level of unemployment. It will likely not be until 2018 before we see unemployment drop below 6.0%.

F o r E C A s t F o r t h E N At I o N

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30-Year Fixed Mortgage RateHousing Starts - Millions

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Automobile and Light Truck Sales(Millions Vehicles)

Auto SalesLight Truck Sales

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Change in Real Business Inventories(Billions of 2000 Dollars)

Change in Real Business Inventories



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Consumer Prices(% Change Year Ago)

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Federal Budget Surplus(Billions of Dollars)

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Industrial Production(2002=100)

Industrial Production

1312111009080706050403020100999897

2000.0

1800.0

1600.0

1400.0

1200.0

1000.0

800.0

Private Fixed Nonresidential Investment(Billions of Dollars)

Private Fixed Nonresidential Investment

1312111009080706050403020100999897

18.0

17.0

16.0

15.0

14.0

13.0

12.0

11.0

Manufacturing Employment(Millions)

Manufacturing Employment



131211100908070605040302010099989796

30.0

20.0

10.0

0.0

-10.0

Money Supply(Annual Growth Rate %)

Annual Growth Rate of M2Annual Growth Rate of M1

1312111009080706050403020100999897

140.0

135.0

130.0

125.0

120.0

Total Nonfarm Payroll Employment(Millions)

Total Nonfarm Employment

1312111009080706050403020100999897

140.0

120.0

100.0

80.0

60.0

40.0

20.0

0.0

120

110

100

90

80

70

60

50

Oil and Consumer ConfidenceOil ($ Per Barrel) - Left Axis

Price of Oil WTI Consumer Sentiment



131211100908070605040302010099989796

8.0

6.0

4.0

2.0

0.0

-2.0

Real Disposable Income and Consumption(% Change Year Ago)

Real Disposable Income Consumption

1312111009080706050403020100999897

-800-700-600-500-400-300-200-100

0 1.40

1.30

1.20

1.10

1.00

0.90

0.80

0.70

Trade Balance and Real Exchange Rate

Trade Balance (Billions $) Left axisU.S. Dollar Real Exchange Rate (2000 = 1.0) Right axis

1312111009080706050403020100999897

500.0

0.0

-500.0

-1000.0

-1500.0

Twin Deficits(Billions of Dollars)

U.S. Federal Budget SurplusCurrent Account



1312111009080706050403020100999897

11.010.09.08.07.06.05.04.03.0

Civilian Unemployment Rate(%)

Unemployment Rate

1312111009080706050403020100999897

7.06.05.04.03.02.01.00.0

Yield Curve(%)

1-Year T-Bill Yield5 Year Treasury Bond Yield25 year Treasury Bond Yield

13121110090807060504030201009998979695949392

7.06.05.04.03.02.01.00.0

-1.0

Federal Funds Rate(%)

Fed Funds Rate

F o r E C A s t F o r t h E N At I o N M a y 2 0 1 0

tA

Bl

Es

Table 15. Government Receipts and Expenditures

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Receipts 1859.3 1885.1 2014.0 2290.1 2524.5 2660.8 2475.0 2226.7 2374.4 2671.5 2886.5 3221.7Personal Tax and Nontax Receipts 828.6 774.2 799.2 931.9 1049.9 1168.1 1102.5 829.5 878.0 1015.4 1191.5 1412.9Corp. Profits Tax Accruals 150.5 197.8 250.3 341.0 395.0 370.2 212.3 231.0 319.8 424.9 396.4 412.7Indirect Business Tax and Nontax Accruals 86.8 89.3 94.3 98.8 99.4 94.7 92.0 92.3 100.1 105.6 109.3 114.3Contributions for Social Insurance 739.3 762.8 807.6 852.6 904.6 944.4 974.5 950.2 971.0 1027.1 1092.0 1179.2

Expenditures 2112.1 2261.5 2393.4 2573.1 2728.3 2897.2 3117.6 3451.3 3666.2 3652.9 3738.1 3861.0Purchases Goods & Services 680.7 756.5 824.7 876.3 931.7 976.7 1082.6 1144.9 1206.8 1204.0 1187.3 1191.5National Defense 437.7 498.0 550.8 589.1 624.9 662.1 737.9 779.1 817.2 809.0 785.8 782.1Other 243.0 258.6 273.9 287.3 306.9 314.6 344.7 365.8 389.6 395.0 401.5 409.4Transfer Payments 1252.1 1339.4 1405.1 1491.3 1587.1 1688.6 1840.6 2134.4 2281.4 2242.7 2267.3 2328.7To Persons 914.9 962.6 1014.3 1078.0 1180.7 1254.2 1388.2 1596.1 1703.5 1709.5 1732.3 1772.1To Foreigners 23.3 28.6 30.9 40.9 35.0 42.2 44.8 46.0 45.7 44.9 45.7 46.6Grants in Aid to State & local Gov't 304.2 338.0 349.2 361.2 359.0 378.9 391.7 476.6 516.0 471.3 471.5 491.3Net Interest 213.7 196.5 204.6 239.0 261.0 290.7 272.3 248.4 262.0 293.6 367.8 424.7Subsidies less Surplus of Gov't Entities 40.3 45.3 45.7 64.1 53.9 50.3 54.3 63.1 59.8 54.5 51.7 50.4Surplus (+) or Deficit (-) -252.8 -376.4 -379.5 -283.0 -203.8 -236.5 -642.6 -1224.7 -1291.9 -981.4 -851.6 -639.3

Receipts 1412.7 1496.3 1601.0 1730.5 1829.7 1927.4 1974.2 1995.5 2093.1 2118.3 2203.4 2301.0Personal Tax/Nontax Receipts 928.7 977.7 1059.4 1163.1 1249.1 1313.4 1336.2 1263.1 1308.2 1366.0 1435.4 1499.9Corporate Profits 221.8 226.2 248.6 276.7 302.5 322.8 330.0 273.0 280.6 302.3 328.1 352.2Indirect Business Tax and Nontax Accruals 30.9 34.0 41.7 55.0 59.1 56.6 51.0 58.5 71.4 70.1 70.8 71.7Contributions for Social Insurance 15.9 20.1 24.1 24.8 21.8 19.8 21.1 21.9 22.3 22.6 23.1 24.0Federal Grants-In-Aid 304.2 338.0 349.2 361.2 359.0 378.9 391.7 476.6 516.0 471.3 471.5 491.3

Expenditures 1466.78 1535.13 1609.33 1704.50 1778.63 1905.63 2014.40 2014.63 2061.92 2126.76 2203.39 2301.4Purchases Goods & Services 1302.7 1356.1 1408.2 1493.6 1586.7 1699.8 1800.6 1785.9 1801.7 1834.2 1875.0 1943.6 Government Social Benefits 333.0 353.4 384.3 404.8 402.9 433.7 455.0 475.9 497.9 544.9 580.5 618.6Transfer Payments 333.0 353.4 384.3 404.8 402.9 433.7 455.0 475.9 497.9 544.9 580.5 618.6Interest Received 12.0 20.6 19.0 10.9 2.1 -2.6 3.9 5.0 7.6 6.3 6.5 10.8Net Subsidies -5.2 -3.2 -0.6 0.3 1.7 11.0 6.1 4.6 3.8 2.5 -1.3 -2.1Dividends Received 1.6 1.7 2.0 2.1 2.3 2.5 2.9 2.8 2.6 2.8 2.9 3.0Net Wage Accruals 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Surplus (+) or Deficit (-) -54.1 -38.8 -8.4 26.0 51.0 21.7 -40.2 -19.2 31.1 -8.5 0.0 -0.4

State and Local Government Receipts and Expenditures

Federal Government Receipts and Expenditures

ForecastHistory

U . s . F o r E C A s t tA B l E s


table 1. summary of the long-term Forecast of the U.s.Table 1. Annual Summary of the Long-Term Forecast of the U.S.

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Gross Domestic Product 1.9 3.8 3.1 2.7 2.5 2.5 -1.8 0.2 2.8 2.8 3.2 2.5 Final Sales of Domestic Product 0.8 3.8 2.8 2.7 2.9 2.7 -1.4 -0.1 2.2 2.8 3.1 2.6Total Consumption 1.9 3.4 3.5 2.7 3.3 2.0 -1.8 1.0 2.6 2.6 2.0 1.4 Durables 1.7 9.2 5.5 2.4 6.5 4.6 -11.7 4.8 7.2 7.6 4.5 2.3 Nondurables 2.1 4.0 3.0 3.3 3.2 1.5 -2.8 1.4 2.3 1.8 1.4 1.0 Services 1.9 2.2 3.4 2.6 2.8 1.7 0.3 0.4 2.0 2.1 1.9 1.3Nonresidential Fixed Investment -6.2 6.0 7.2 4.4 8.0 8.0 -5.6 -12.3 6.3 7.3 12.4 7.7 Equipment & Software -2.6 7.6 9.1 6.1 6.2 3.2 -10.2 -5.2 14.3 11.0 10.8 6.1 Information Processing Equipment 0.0 14.4 5.9 6.8 7.9 10.3 -1.1 5.3 11.3 6.6 7.6 6.7 Computers & Peripherals 7.4 17.4 10.8 15.0 18.6 23.5 -7.8 27.3 20.5 12.2 18.4 17.9 Communications Equipment -17.0 17.8 -1.6 5.6 13.1 15.0 -3.3 2.3 10.9 13.1 9.2 8.3 Industrial Equipment -0.9 -1.5 3.9 9.9 5.9 3.6 -6.2 -21.3 18.0 19.6 8.4 -3.3 Transportation equipment -13.5 8.6 27.6 2.8 11.2 -11.5 -43.1 5.6 32.1 28.7 38.6 17.3 Aircraft -28.7 24.3 64.0 -31.4 15.6 15.5 -18.1 -0.5 305.1 13.8 17.5 4.9 Other Equipment 11.4 11.0 29.9 8.2 12.2 -37.9 -17.3 -9.9 24.5 24.1 44.9 20.0 Structures -15.6 1.5 1.7 0.0 13.3 19.0 3.5 -24.3 -10.7 -2.4 17.4 12.4 Commercial & Health Care -12.1 1.1 -0.8 1.1 7.9 10.3 -9.9 -31.0 -15.0 3.4 30.9 23.3 Manufacturing -33.7 8.5 20.7 5.8 10.0 43.9 22.1 4.1 -20.5 -6.9 35.7 13.1 Power & Communication -14.2 -6.3 -3.6 -4.3 13.8 48.5 -0.5 8.0 -13.1 -0.6 1.1 3.1 Mining & Petroleum -9.5 18.5 14.6 6.9 25.5 9.2 20.4 -17.3 14.7 -10.4 6.2 2.6 Other -11.4 1.2 1.5 -4.6 13.1 23.5 -0.3 -25.6 -14.9 1.3 14.5 11.3Residential Fixed Investment 7.5 11.7 6.7 5.3 -15.5 -20.2 -20.8 -9.7 6.6 31.1 14.9 6.3Exports 4.2 6.6 7.1 6.8 10.4 10.4 -2.8 1.6 9.0 5.9 7.6 8.8Imports 9.7 5.4 11.0 5.2 4.2 1.0 -6.6 -3.5 10.6 5.8 5.9 3.8Federal Government 8.2 6.0 2.5 1.3 2.3 3.6 8.9 3.8 2.3 -4.5 -2.7 -1.3State & Local Government 2.0 -0.5 -0.4 0.4 1.2 1.9 -0.3 -0.1 -0.5 0.0 0.8 1.3

Real GDP 11553.0 11840.7 12263.8 12638.4 12976.3 13254.1 13312.2 12987.4 13392.8 13735.5 14166.6 14550.3Nominal GDP 10642.3 11142.2 11867.8 12638.4 13398.9 14077.7 14441.4 14256.3 14852.5 15451.5 16205.2 16941.4

GDP Deflator 1.8 2.1 3.2 3.5 2.9 2.7 2.0 0.7 1.3 1.6 1.8 1.7Consumer Prices 2.3 2.0 3.4 3.7 2.0 4.0 1.8 1.5 1.2 1.8 2.1 2.0 Excl. Food & Energy 2.1 1.2 2.2 2.1 2.7 2.3 2.0 1.7 0.8 1.8 1.9 1.9Producer Prices, Finished Goods 1.0 3.6 4.7 5.3 0.2 6.7 2.2 1.7 1.4 1.5 2.4 1.7Employment Cost Index - Total Comp. 3.1 4.0 3.7 3.0 3.1 3.1 2.4 1.2 1.9 2.3 2.2 2.5

Oil - WTI ($ per barrel) 26.1 31.1 41.5 56.6 66.1 72.2 99.8 61.8 76.9 81.7 87.2 91.3Productivity (% change) 3.2 5.1 1.5 1.5 1.0 2.9 1.4 5.7 1.5 0.4 0.6 0.8Industrial Production (% change) 2.5 1.7 3.0 2.7 1.8 1.8 -6.6 -4.0 5.8 3.7 3.5 3.4Factory Operating Rate 72.7 73.7 76.2 78.6 79.4 79.0 75.1 66.8 71.5 74.8 76.7 77.5Nonfarm Inven. Chg. (Bil. of 2005 $) 15.6 17.2 58.3 49.8 63.2 20.4 -20.4 -108.3 43.7 46.6 56.8 47.1Consumer Sentiment Index 89.6 87.6 95.2 88.6 87.3 85.6 63.8 66.3 74.0 76.6 77.6 79.0Light Vehicle Sales (Million units) 16.816 16.643 16.867 16.948 16.504 16.089 13.195 10.345 11.345 12.992 14.8 15.8Housing Starts (Million units) 1.710 1.854 1.949 2.073 1.812 1.342 0.900 0.553 0.697 1.145 1.5 1.7Existing House Sales (Million units) 4.997 5.443 5.914 6.181 5.712 4.959 4.337 4.567 4.804 4.965 5.4 5.6Unemployment Rate (%) 5.8 6.0 5.5 5.1 4.6 4.6 5.8 9.3 9.7 9.4 8.6 8.0Payroll Employment (% change) -0.5 -0.1 1.6 1.8 1.6 0.9 -2.0 -4.0 0.9 2.2 2.5 1.8Federal Surplus (Unified, FY, bil. $) -158 -377 -413 -319 -248 -162 -455 -1416 -1286 -1125 -871 -664Current Account Balance (Bil. $) -459 -522 -631 -749 -804 -727 -706 -420 -514 -567 -620 -585

Federal Funds Rate (%) 1.67 1.13 1.35 3.21 4.96 5.02 1.93 0.16 0.42 2.20 3.5 3.73-Month Treasury Bill Rate (%) 1.61 1.01 1.36 3.13 4.72 4.38 1.40 0.15 0.29 1.93 3.2 3.51-Year Treasury Note Yield (%) 2.00 1.24 1.89 3.62 4.93 4.52 1.82 0.47 0.54 2.22 3.5 3.75-Year Treasury Note Yield (%) 3.82 2.97 3.43 4.05 4.75 4.43 2.80 2.19 2.45 3.35 4.2 4.410-Year Treasury Note Yield (%) 4.61 4.02 4.27 4.29 4.79 4.63 3.67 3.26 3.65 4.01 4.6 4.825-Year Treasury Note Yield (%) 5.42 5.05 5.12 4.56 4.87 4.84 4.28 4.07 4.54 4.83 5.0 5.230-Year Fixed Mortgage Rate (%) 6.54 5.82 5.84 5.86 6.42 6.33 6.04 5.04 4.96 5.43 6.0 6.2S&P 500 Stock Index 996 964 1131 1207 1311 1477 1221 947 1128 1183 1305 1390 (% change) -17.3 20.8 11.2 6.1 13.8 7.9 -32.4 27.1 5.3 7.4 9.4 5.5Exchange Rate, Major Trading Partners 1.266 1.111 1.020 1.000 0.985 0.930 0.889 0.929 0.936 0.929 0.9 0.9 (% change (negative = depreciation)) -5.1 -14.1 -6.1 4.9 -4.7 -9.9 13.1 -9.0 7.9 -2.3 -2.4 -1.3

Personal Income (Bil. of $) 9060 9378 9937 10486 11268 11894 12239 12026 12417 12966 13585 14222 (% change) 2.4 5.0 6.7 5.1 7.1 5.2 1.1 -1.0 4.4 4.4 5.0 4.6Disposable Income (Bil. of $) 8010 8378 8889 9277 9916 10403 10806 10924 11259 11648 12065 12457 (% change) 5.3 5.9 6.7 4.0 6.6 4.6 2.3 2.2 3.7 3.5 3.6 3.4Real Disposable Income (Bil. Of 2005 $) 8637 8854 9155 9277 9651 9861 9911 9999 10145 10337 10526 10678 (% change) 3.3 3.9 3.5 0.6 4.6 1.0 0.6 0.9 2.5 1.8 1.7 1.6Saving Rate (%) 3.6 3.5 3.4 1.4 2.4 1.7 2.7 4.2 3.6 3.2 2.6 2.4After-Tax Profits (Billions of $) 573 660 923 1228 1349 1323 1171 1113 1405 1299 1349 1376 (% change) 38.0 14.5 36.3 41.9 2.8 2.7 -26.1 53.7 11.9 -4.1 4.7 -0.7

ForecastHistory

Composition of Real GDP, Percent Change

Billions of Dollars

Prices & Wages, Percent Change, Annual Rate

Other Measures

Financial Markets, NSA

Incomes



table 2. real gross domestic ProductTable 2. Real Gross Domestic Product

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Gross Domestic Product 11553.0 11840.7 12263.8 12638.4 12976.3 13254.1 13312.2 12987.4 13392.8 13735.5 14166.6 14550.3

Final Sales of Domestic Product 11543.5 11824.8 12198.2 12588.4 12917.1 13234.4 13341.2 13110.7 13362.2 13700.5 14122.0 14515.5

Total Consumption 8021.9 8247.6 8532.7 8819.0 9073.5 9313.9 9290.9 9235.1 9449.7 9679.5 9910.5 10062.1

Durables 930.0 986.1 1051.0 1105.5 1150.4 1199.9 1146.3 1101.4 1180.0 1254.8 1339.9 1377.6

Nondurables 1780.2 1845.6 1904.6 1968.4 2023.6 2074.8 2057.3 2037.0 2087.2 2123.1 2156.7 2180.1

Services 5318.1 5418.4 5577.6 5745.1 5899.7 6040.8 6083.1 6087.8 6182.7 6311.0 6435.8 6530.8

Nonresidential Fixed Investment 1180.2 1191.0 1263.0 1347.3 1453.9 1544.3 1569.7 1291.0 1337.4 1425.3 1580.9 1733.0

Equipment & Software 830.3 851.4 917.3 995.6 1069.6 1097.0 1068.6 890.7 1001.6 1127.0 1245.8 1342.7

Information Processing Equipment 379.3 405.0 443.1 475.3 514.8 555.7 588.8 556.7 637.3 681.3 732.3 783.4

Computers & Peripherals 58.2 63.4 70.6 78.9 97.1 114.3 123.9 117.3 155.1 173.2 202.9 240.3

Communications Equipment 73.7 75.4 81.7 83.2 92.2 98.2 101.6 92.7 102.0 115.6 128.4 138.8

Industrial Equipment 151.9 151.6 147.4 159.6 172.9 180.9 174.7 133.6 137.5 170.0 190.3 190.1

Transportation equipment 141.6 132.9 161.1 181.7 198.2 181.7 132.3 72.5 91.8 124.6 162.3 203.0

Aircraft 31.6 22.6 25.1 22.0 20.6 22.3 18.0 13.5 11.7 16.9 19.7 21.4

Other Equipment 32.7 31.7 40.8 48.2 51.6 37.1 29.3 17.8 19.5 25.2 32.9 39.9

Structures 356.6 343.0 346.7 351.8 384.0 441.4 486.8 390.3 338.1 309.9 347.1 399.3

Commercial & Health 142.8 133.8 137.1 135.9 144.2 158.5 155.6 115.2 88.6 84.5 103.3 131.1

Manufacturing 26.2 24.3 25.5 29.9 33.0 40.4 50.6 61.5 43.3 37.5 46.1 56.0

Power & Communication 60.5 55.7 46.2 45.2 48.7 65.3 77.3 76.7 72.0 65.7 67.6 68.3

Mining & Petroleum 52.6 60.0 69.9 77.1 88.3 97.1 112.7 65.9 78.1 68.5 68.9 74.1

Other 68.9 66.5 67.4 63.7 69.6 80.8 89.8 73.2 55.8 53.4 59.6 67.0

Residential Fixed Investment 613.9 664.3 729.5 775.0 718.2 585.0 451.1 358.7 367.8 455.3 557.2 605.0

Exports 1099.2 1116.8 1222.8 1305.1 1422.1 1546.2 1629.3 1472.4 1644.2 1758.9 1879.7 2040.5

Imports 1648.0 1720.7 1910.8 2027.8 2151.2 2193.8 2123.5 1828.0 2030.9 2178.1 2311.0 2415.6

Federal Government 779.5 831.1 865.0 876.3 894.9 906.4 975.9 1026.6 1061.0 1037.5 1000.0 982.0

State & Local Government 1500.7 1499.7 1497.1 1493.6 1507.2 1536.7 1543.7 1541.0 1526.8 1530.6 1535.0 1555.3

Forecast

Real GDP Billions 2005 $

History



table 3. Quarterly summary of the Forecast of the U.s.Table 3. Quarterly Summary of the Forecast of the U.S.

2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4

Gross Domestic Product 5.6 3.2 3.3 2.3 2.3 2.2 2.6 3.2 3.2 3.1 3.3 3.2 3.0 2.4 2.6 2.5 2.4 Final Sales of Domestic Product 1.7 1.6 3.2 1.7 2.3 2.4 2.6 3.2 3.2 3.0 3.2 3.0 3.0 2.6 2.8 2.6 2.5Total Consumption 1.6 3.6 2.0 2.3 2.6 2.2 2.4 2.8 3.1 2.1 2.3 1.9 1.8 1.0 1.5 1.3 1.6 Durables 0.4 11.3 6.5 5.6 5.6 5.6 5.5 8.7 10.7 8.3 4.3 3.2 2.0 3.8 3.7 0.7 0.9 Nondurables 4.0 3.9 1.9 1.6 2.0 1.2 1.8 2.1 2.1 1.0 1.6 1.5 1.5 0.4 0.9 1.3 1.3 Services 1.0 2.4 1.4 2.0 2.4 2.0 2.1 2.1 2.4 1.5 2.2 1.9 1.9 0.8 1.3 1.5 1.8Nonresidential Fixed Investment 5.3 4.0 11.0 6.2 4.0 6.4 6.2 9.1 7.5 13.0 13.0 12.8 10.9 9.6 8.4 6.8 6.1 Equipment & Software 19.0 13.4 18.1 13.1 12.5 13.7 11.5 11.3 7.4 12.2 10.8 10.8 9.5 7.3 6.1 5.5 5.5 Information Processing Equipment 27.6 15.6 16.8 6.8 5.9 5.7 6.4 6.9 7.4 8.3 7.6 7.1 7.2 7.2 6.7 6.5 6.2 Computers & Peripherals 97.5 27.6 32.8 12.7 8.9 7.3 8.8 15.7 17.1 17.8 18.3 18.6 19.1 18.7 18.4 18.1 16.5 Communications Equipment 22.4 -4.7 25.3 11.2 11.6 13.2 13.6 12.3 13.0 13.1 8.3 7.4 7.9 8.4 8.0 8.6 8.2 Industrial Equipment -7.0 -0.1 12.5 28.1 31.5 26.8 21.5 16.8 13.3 11.5 10.7 8.5 3.0 -2.8 -4.9 -4.0 -1.4 Transportation Equipment 48.8 -16.1 82.6 34.2 27.7 51.6 31.4 31.8 -0.2 45.5 34.8 40.3 33.9 24.9 19.0 14.1 11.4 Aircraft -60.7 -94.3 1126.2 136.5 52.2 13.5 19.1 9.2 13.4 18.2 23.4 16.1 12.3 4.9 3.4 6.1 5.1 Other Equipment 6.5 -10.5 -19.2 111.8 16.0 89.5 -19.7 42.1 -15.5 109.0 27.9 23.0 19.9 15.4 34.5 15.9 14.2 Structures -18.0 -14.0 -4.1 -9.0 -15.8 -11.8 -8.2 2.4 7.8 15.6 19.7 19.0 15.1 16.4 15.2 10.3 7.7 Commercial & Health Care -37.0 -20.6 -13.7 -13.3 -12.4 -5.6 2.6 7.7 8.9 30.7 33.9 31.5 27.5 29.1 26.6 20.4 17.1 Manufacturing -43.9 -51.9 2.3 -16.2 -16.2 -15.4 -18.5 -15.8 22.1 33.4 46.7 42.4 20.3 23.5 17.1 8.5 3.3 Power & Communication -5.1 1.3 -24.3 -16.0 -13.4 -10.1 -6.2 8.3 5.7 3.6 3.2 -1.0 -1.4 -0.8 3.5 3.7 6.1 Mining & Petroleum 73.8 43.8 32.8 8.2 -26.0 -22.8 -19.7 5.9 -5.0 -1.8 4.7 10.1 12.0 11.6 8.8 -2.0 -7.9 Other -34.3 -35.7 -6.9 -10.0 -7.2 -4.5 -3.1 -2.3 15.0 15.5 15.5 14.6 12.6 12.2 11.9 11.3 10.0Residential Fixed Investment 3.7 -10.9 10.6 11.8 14.9 23.6 36.4 34.0 30.6 24.1 14.6 11.4 9.4 9.8 6.3 6.0 3.0Exports 22.8 5.8 14.4 9.1 6.9 5.6 6.2 6.3 5.6 7.1 7.4 7.7 8.4 9.2 8.7 8.7 8.3Imports 15.8 8.9 12.8 12.8 7.9 4.7 5.7 6.4 6.1 6.6 5.9 5.8 5.2 4.6 3.6 3.5 3.5Federal Government 0.0 1.3 6.5 0.9 0.6 -3.9 -5.1 -4.8 -4.2 -3.7 -2.8 -2.3 -2.1 -1.9 -1.5 -1.0 -0.8State & Local Government -2.2 -3.8 1.6 -0.3 0.5 0.5 -0.2 0.3 -0.4 0.0 0.7 1.1 1.5 1.5 1.5 1.1 1.0

Real GDP 13150 13255 13363 13439 13514 13589 13677 13784 13892 14000 14113 14224 14330 14415 14506 14596 14684Nominal GDP 14454 14601 14812 14955 15041 15198 15356 15535 15716 15915 16106 16303 16498 16681 16856 17027 17201

GDP Deflator 0.5 0.9 2.6 1.6 0.1 2.0 1.6 1.5 1.5 1.9 1.6 1.7 1.8 2.1 1.6 1.6 1.7Consumer Prices 2.6 1.5 0.3 1.5 1.4 1.8 1.8 2.0 1.9 2.0 2.0 2.2 2.2 2.1 2.0 1.9 1.9 Excl. Food & Energy 1.5 0.0 1.2 1.0 1.2 1.8 1.7 1.7 1.7 1.9 1.9 1.9 1.9 1.9 1.9 1.9 1.8Producer Prices, Finished Goods 6.5 8.9 -3.4 -0.3 0.5 1.3 1.0 1.7 2.1 1.6 2.0 2.9 3.0 2.0 1.4 1.3 2.0Employment Cost Index - Total Comp. 1.5 2.6 1.2 1.9 1.8 3.4 1.9 1.8 1.9 2.4 2.1 2.2 2.3 2.5 2.4 2.4 2.5

Oil - WTI ($ per barrel) 76.0 78.8 78.3 74.0 76.4 78.6 80.3 83.1 84.7 85.7 86.7 87.7 88.7 89.8 90.9 91.8 92.7Productivity (% change) 6.3 3.6 1.9 0.1 0.5 0.1 0.1 0.7 0.5 0.4 0.7 0.7 0.7 0.4 0.8 1.0 1.2Industrial Production (% change) 6.9 7.8 5.4 5.8 4.3 4.4 3.6 3.5 3.3 3.4 3.6 3.4 3.4 3.4 3.4 3.4 3.4Factory Operating Rate 68.2 69.5 71.1 72.3 73.1 73.8 74.6 75.3 75.7 76.1 76.6 77.0 77.2 77.3 77.5 77.7 77.8Nonfarm Inven. Chg. (Bil. of 2005 $) -13.7 34.9 37.3 52.3 50.4 45.8 46.4 47.1 47.2 52.4 53.8 60.2 60.7 54.7 46.4 45.2 42.1Consumer Sentiment Index 70.2 73.9 72.5 74.4 75.2 76.3 76.3 76.6 77.2 77.6 77.2 77.5 78.1 78.6 79.2 79.2 78.9Light Vehicle Sales (Million units) 10.840 10.955 11.331 11.345 11.749 12.114 12.675 13.282 13.895 14.464 14.698 15.007 15.149 15.528 15.810 15.871 15.933Housing Starts (Million units) 0.559 0.617 0.667 0.719 0.787 0.926 1.089 1.225 1.341 1.432 1.511 1.575 1.621 1.651 1.700 1.727 1.728Existing House Sales (Million units) 5.233 4.490 5.081 4.802 4.842 4.865 4.888 4.977 5.132 5.257 5.328 5.493 5.489 5.523 5.547 5.699 5.684Unemployment Rate (%) 10.0 9.7 9.9 9.7 9.7 9.6 9.5 9.3 9.1 8.9 8.7 8.5 8.3 8.2 8.0 7.9 7.8Payroll Employment (% change) -1.3 0.2 2.0 0.4 0.9 1.6 2.1 2.4 2.6 2.7 2.6 2.6 2.3 2.1 1.9 1.7 1.5Federal Surplus (NIPA Bil. $) -1307 -1282 -1301 -1305 -1280 -1006 -989 -970 -960 -878 -867 -844 -817 -676 -635 -617 -629Current Account Balance (Bil. $) -462 -538 -476 -502 -541 -550 -553 -572 -591 -619 -622 -622 -617 -609 -587 -572 -570

Federal Funds Rate (%) 0.12 0.13 0.17 0.14 0.39 0.90 1.36 1.81 2.34 2.83 3.29 3.37 3.37 3.37 3.38 3.38 3.573-Month Treasury Bill Rate (%) 0.06 0.11 0.16 0.24 0.68 1.21 1.68 2.17 2.65 3.03 3.26 3.32 3.33 3.33 3.34 3.45 3.871-Year Treasury Note Yield (%) 0.35 0.37 0.41 0.47 0.93 1.49 1.98 2.48 2.94 3.28 3.51 3.57 3.58 3.58 3.59 3.71 4.125-Year Treasury Note Yield (%) 2.30 2.42 2.44 2.32 2.61 2.89 3.14 3.51 3.85 4.06 4.20 4.25 4.26 4.26 4.26 4.36 4.7510-Year Treasury Note Yield (%) 3.46 3.72 3.69 3.51 3.69 3.85 3.93 4.03 4.24 4.43 4.57 4.62 4.63 4.63 4.62 4.73 5.1225-Year Treasury Note Yield (%) 4.33 4.62 4.56 4.42 4.58 4.74 4.81 4.86 4.89 4.91 5.01 5.05 5.05 5.06 5.05 5.16 5.5530-Year Fixed Mortgage Rate (%) 4.90 5.00 4.98 4.82 5.04 5.23 5.34 5.47 5.68 5.89 6.04 6.09 6.09 6.09 6.09 6.19 6.58S&P 500 Stock Index 1089 1122 1130 1117 1144 1146 1165 1194 1228 1263 1293 1321 1343 1363 1381 1399 1417 (% change) 42.4 12.6 3.0 -4.6 10.3 0.5 7.0 10.1 11.9 11.9 9.8 8.8 7.0 6.0 5.4 5.3 5.4Exchange Rate, Major Trading Partners 0.879 0.902 0.936 0.960 0.945 0.934 0.932 0.929 0.923 0.916 0.913 0.908 0.900 0.896 0.892 0.890 0.888 (%change (negative = depreciation)) -9.5 11.1 15.9 10.6 -6.1 -4.6 -1.0 -1.3 -2.3 -2.9 -1.4 -2.1 -3.3 -2.1 -1.6 -1.1 -0.6

Personal Income (Bil. of $) 12098 12213 12337 12495 12626 12768 12889 13030 13176 13330 13501 13671 13839 13965 14137 14308 14478 (% change) 3.1 3.9 4.1 5.2 4.3 4.6 3.8 4.5 4.6 4.8 5.2 5.1 5.0 3.7 5.0 4.9 4.8Disposable Income (Bil. of $) 11029 11070 11191 11340 11434 11470 11581 11704 11837 11868 12006 12131 12256 12275 12378 12508 12667 (% change) 3.5 1.5 4.4 5.5 3.3 1.3 3.9 4.3 4.6 1.1 4.7 4.2 4.2 0.6 3.4 4.3 5.2Real Disposable Income (Bil. of 2005 $) 10009 10009 10107 10206 10257 10242 10299 10365 10441 10423 10500 10561 10622 10588 10632 10700 10791 (% change) 1.0 0.0 4.0 4.0 2.0 -0.6 2.3 2.6 3.0 -0.7 3.0 2.4 2.3 -1.2 1.6 2.6 3.5Saving Rate (%) 3.9 3.1 3.5 3.9 3.8 3.2 3.2 3.1 3.1 2.4 2.6 2.6 2.7 2.1 2.1 2.4 2.8After-Tax Profits (Billions of $) 1270 1395 1417 1408 1401 1276 1288 1307 1323 1313 1334 1365 1384 1369 1381 1382 1374 (% change) 37.0 45.6 6.3 -2.3 -2.1 -31.2 3.8 6.2 5.0 -2.9 6.5 9.5 5.8 -4.3 3.4 0.3 -2.3

Financial Markets, NSA

Incomes

Composition of Real GDP, Percent Change, Annual Rate

Billions of Dollars

Prices & Wages, Percent Change, Annual Rate

Other Key Measures



table 4. Quarterly gross domestic ProductTable 4. Quarterly Gross Domestic Product


Gross Domestic Product 13149.5 13254.7 13363.4 13438.8 13514.1 13589.1 13676.9 13784.2 13891.9 13999.7 14112.6 14224.3 14329.8 14414.7 14506.3 14596.5 14683.8

Final Sales of Domestic Product 13181.9 13235.7 13340.5 13397.6 13475.0 13554.7 13642.1 13748.7 13856.4 13959.3 14070.8 14176.4 14281.4 14372.3 14472.1 14563.5 14653.9

Total Consumption 9289.5 9372.7 9419.8 9472.6 9533.7 9584.8 9641.5 9708.2 9783.4 9833.5 9889.6 9937.0 9982.0 10007.7 10044.8 10078.3 10117.8

Durables 1123.7 1154.2 1172.5 1188.5 1204.7 1221.3 1237.8 1263.8 1296.3 1322.4 1336.4 1347.1 1353.8 1366.5 1378.8 1381.1 1384.2

Nondurables 2053.4 2073.2 2082.8 2091.2 2101.6 2107.7 2117.2 2128.3 2139.2 2144.3 2153.0 2160.9 2168.8 2171.1 2176.2 2183.0 2190.1

Services 6105.9 6142.4 6163.9 6194.1 6230.2 6260.7 6293.3 6326.6 6363.5 6386.9 6421.9 6451.8 6482.4 6495.5 6517.1 6541.0 6569.8

Nonresidential Fixed Investment 1285.5 1298.3 1332.5 1352.9 1366.1 1387.5 1408.5 1439.5 1465.9 1511.4 1558.1 1605.9 1648.1 1686.3 1720.8 1749.3 1775.5

Equipment & Software 918.9 948.3 988.6 1019.4 1050.0 1084.2 1114.1 1144.4 1165.2 1199.2 1230.4 1262.4 1291.5 1314.5 1334.0 1352.1 1370.4

Information Processing Equipment 589.7 611.5 635.7 646.3 655.6 664.8 675.1 686.5 698.7 712.9 726.1 738.7 751.7 764.8 777.4 789.8 801.8

Computers & Peripherals 135.5 144.0 154.6 159.3 162.7 165.6 169.1 175.4 182.5 190.1 198.3 206.9 216.1 225.6 235.3 245.3 254.8

Communications Equipment 96.9 95.8 101.3 104.1 107.0 110.4 113.9 117.3 120.9 124.7 127.2 129.5 132.0 134.7 137.4 140.2 143.0

Industrial Equipment 128.0 128.0 131.8 140.2 150.2 159.3 167.3 173.9 179.4 184.4 189.2 193.0 194.4 193.1 190.6 188.7 188.0

Transportation equipment 80.9 77.4 90.0 96.8 102.9 114.2 122.3 131.0 131.0 143.9 155.0 168.7 181.5 191.8 200.4 207.1 212.7

Aircraft 12.3 6.0 11.3 14.0 15.5 16.0 16.8 17.1 17.7 18.4 19.4 20.2 20.8 21.0 21.2 21.5 21.8

Other Equipment 18.7 18.2 17.3 20.8 21.6 25.4 24.0 26.2 25.1 30.2 32.1 33.9 35.4 36.7 39.5 41.0 42.4

Structures 361.7 348.3 344.7 336.7 322.5 312.5 305.9 307.7 313.6 325.1 340.1 355.2 368.0 382.2 396.0 405.8 413.4

Commercial & Health 99.0 93.4 90.1 86.9 84.1 82.9 83.4 85.0 86.8 92.9 99.9 107.0 113.7 121.2 128.5 134.6 140.0

Manufacturing 53.5 44.6 44.8 42.9 41.0 39.3 37.4 35.8 37.6 40.5 44.5 48.6 50.9 53.7 55.9 57.0 57.5

Power & Communication 77.9 78.2 72.9 69.8 67.3 65.6 64.5 65.8 66.7 67.3 67.8 67.7 67.4 67.3 67.9 68.5 69.5

Mining & Petroleum 68.2 74.7 80.1 81.7 75.8 71.1 67.3 68.2 67.4 67.0 67.8 69.5 71.5 73.5 75.0 74.6 73.1

Other 64.3 57.6 56.5 55.1 54.1 53.4 53.0 52.7 54.6 56.6 58.7 60.7 62.5 64.3 66.2 68.0 69.6

Residential Fixed Investment 362.9 352.6 361.6 371.9 385.0 406.0 438.7 472.0 504.6 532.6 551.0 566.1 578.9 592.7 601.7 610.6 615.2

Exports 1556.8 1578.8 1632.8 1668.7 1696.6 1719.8 1746.0 1772.7 1797.2 1828.2 1860.9 1895.6 1934.3 1977.3 2019.2 2062.0 2103.6

Imports 1904.8 1945.8 2005.2 2066.5 2106.0 2130.6 2160.4 2194.3 2227.2 2263.0 2295.5 2327.8 2357.6 2384.1 2405.2 2426.2 2446.9

Federal Government 1043.4 1046.9 1063.5 1065.9 1067.5 1056.9 1043.2 1030.4 1019.4 1009.7 1002.4 996.6 991.3 986.5 982.8 980.4 978.4

State & Local Government 1537.0 1522.1 1528.3 1527.3 1529.3 1531.1 1530.2 1531.3 1529.7 1529.5 1532.2 1536.2 1542.0 1547.8 1553.5 1557.9 1561.8

Real GDP Billions 2005 $



table 5. Annual EmploymentTable 5. Annual Employment

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Total Nonfarm Employment 130.340 129.996 131.419 133.694 136.086 137.588 136.777 130.911 130.322 132.410 135.753 138.600

Private Nonfarm 108.831 108.416 109.801 111.890 114.114 115.371 114.272 108.360 107.867 110.314 113.581 116.149

Mining 0.512 0.503 0.523 0.562 0.620 0.663 0.709 0.650 0.657 0.634 0.620 0.616

Construction 6.715 6.736 6.973 7.333 7.692 7.630 7.161 6.036 5.510 5.480 5.834 6.300

Manufacturing 15.257 14.508 14.315 14.225 14.157 13.877 13.401 11.884 11.736 12.188 12.677 13.022

Trade, Transportation and Utilities 25.500 25.287 25.536 25.960 26.275 26.625 26.292 24.949 24.667 24.860 25.643 26.219

Transportation & Warehousing 4.224 4.184 4.250 4.363 4.469 4.540 4.507 4.234 4.128 4.276 4.546 4.740

Financial Activities 7.848 7.976 8.031 8.153 8.328 8.300 8.143 7.758 7.612 7.715 7.866 7.878

Education & Health 16.201 16.588 16.950 17.370 17.824 18.321 18.840 19.187 19.546 19.969 20.394 20.632

Professional & Business Services 15.975 15.985 16.388 16.952 17.570 17.944 17.735 16.575 16.863 17.986 18.814 19.487

Information 3.394 3.189 3.117 3.061 3.038 3.031 2.984 2.807 2.751 2.855 2.902 2.932

Leisure & Hospitality 11.986 12.175 12.492 12.813 13.108 13.425 13.437 13.100 13.147 13.196 13.381 13.598

Government 21.509 21.580 21.618 21.804 21.971 22.218 22.504 22.551 22.455 22.096 22.172 22.451

Federal 2.766 2.760 2.731 2.732 2.733 2.734 2.762 2.827 2.948 2.778 2.737 2.714

State & Local 18.744 18.820 18.887 19.073 19.239 19.484 19.743 19.724 19.508 19.318 19.436 19.737

Total Nonfarm Employment -1.13 -0.26 1.09 1.73 1.79 1.10 -0.59 -4.29 -0.44 1.60 2.52 2.10

Private Nonfarm -1.69 -0.38 1.28 1.90 1.99 1.10 -0.95 -5.17 -0.44 2.27 2.96 2.26

Mining -4.01 -0.23 5.16 9.36 10.01 5.76 6.57 -12.64 4.90 -4.51 -1.21 -0.78

Construction -1.32 1.53 4.31 5.81 2.38 -1.94 -9.36 -15.92 -5.35 2.98 7.84 7.30

Manufacturing -5.35 -4.46 -0.05 -0.84 -1.07 -2.08 -5.45 -10.86 3.13 3.89 3.60 2.20

Trade, Transportation and Utilities -1.07 -0.57 1.52 1.64 1.12 1.16 -3.34 -4.36 -0.05 1.93 3.12 1.73

Transportation & Warehousing -0.89 -1.00 2.58 2.48 2.54 0.96 -2.68 -5.75 -1.00 6.11 5.70 3.53

Financial Activities 0.71 1.25 0.95 2.13 1.35 -1.29 -2.48 -4.61 -0.81 2.51 1.33 -0.37

Education & Health 3.17 2.12 2.36 2.51 2.64 2.89 2.56 1.68 1.84 2.55 1.67 0.93

Professional & Business Services -1.27 1.08 2.99 3.74 3.07 1.61 -3.67 -5.17 5.10 6.27 4.05 3.31

Information -6.12 -5.02 -2.04 -1.07 -0.96 -0.02 -3.05 -5.80 0.99 3.32 1.05 0.99

Leisure & Hospitality 0.93 1.59 2.59 2.15 2.83 2.11 -1.65 -2.06 1.35 0.01 2.22 1.18

Government 1.21 -0.14 0.62 0.81 1.02 1.17 1.02 -0.26 -1.20 -0.68 0.89 1.35

Federal 0.83 -1.55 -0.37 0.34 -0.23 0.53 1.18 2.15 2.63 -2.52 -1.13 -0.68

State & Local 1.27 0.08 0.77 0.88 1.20 1.26 1.00 -0.59 -1.43 -0.41 1.18 1.63

Millions

Growth Rates

ForecastHistory



table 6. Quarterly EmploymentTable 6. Quarterly Employment


Total Nonfarm Employment 129.6 129.7 130.3 130.5 130.8 131.3 132.0 132.8 133.6 134.5 135.3 136.2 137.0 137.7 138.4 138.9 139.4

Private Nonfarm 107.1 107.2 107.6 108.1 108.6 109.1 109.9 110.7 111.5 112.4 113.2 114.0 114.7 115.4 115.9 116.4 116.9

Mining 0.6 0.6 0.7 0.7 0.7 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6

Construction 5.7 5.6 5.6 5.4 5.4 5.4 5.4 5.5 5.6 5.7 5.8 5.9 6.0 6.1 6.3 6.4 6.5

Manufacturing 11.6 11.6 11.7 11.8 11.9 12.0 12.1 12.2 12.4 12.5 12.6 12.7 12.8 12.9 13.0 13.1 13.1

Trade, Transportation and Utilities 24.7 24.7 24.7 24.7 24.7 24.7 24.7 24.9 25.1 25.4 25.6 25.8 25.9 26.1 26.2 26.3 26.4

Transportation & Warehousing 4.2 4.1 4.1 4.1 4.1 4.2 4.2 4.3 4.4 4.5 4.5 4.6 4.6 4.7 4.7 4.8 4.8

Financial Activities 7.7 7.6 7.6 7.6 7.6 7.6 7.7 7.7 7.8 7.8 7.9 7.9 7.9 7.9 7.9 7.9 7.9

Education & Health 19.3 19.4 19.5 19.6 19.7 19.7 19.9 20.1 20.2 20.3 20.4 20.4 20.5 20.5 20.6 20.7 20.7

Professional & Business Services 16.4 16.6 16.7 16.9 17.3 17.6 17.9 18.1 18.4 18.5 18.7 18.9 19.1 19.3 19.4 19.6 19.7

Information 2.8 2.7 2.7 2.7 2.8 2.8 2.8 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9

Leisure & Hospitality 13.0 13.0 13.1 13.2 13.2 13.2 13.2 13.2 13.2 13.3 13.3 13.4 13.5 13.6 13.6 13.6 13.6

Government 22.5 22.5 22.7 22.4 22.2 22.2 22.1 22.1 22.1 22.1 22.1 22.2 22.3 22.3 22.4 22.5 22.6

Federal 2.8 2.9 3.1 3.0 2.8 2.8 2.8 2.8 2.8 2.7 2.7 2.7 2.7 2.7 2.7 2.7 2.7

State & Local 19.7 19.6 19.6 19.5 19.4 19.3 19.3 19.3 19.3 19.3 19.4 19.5 19.5 19.6 19.7 19.8 19.9

Total Nonfarm Employment -1.35 0.20 1.99 0.36 0.92 1.60 2.11 2.36 2.54 2.65 2.53 2.53 2.32 2.06 1.91 1.65 1.47

Private Nonfarm -1.62 0.32 1.56 1.54 1.83 2.17 2.74 2.92 3.06 3.09 2.85 2.82 2.54 2.21 2.00 1.71 1.50

Mining -2.73 11.77 12.15 -0.49 -5.03 -5.97 -4.96 -5.05 -2.41 -1.62 -2.17 -0.89 -0.18 -0.06 -0.27 -0.98 -1.83

Construction -10.72 -7.99 -3.21 -8.57 -2.21 -0.65 1.81 5.28 5.24 6.02 8.06 8.04 8.32 8.19 7.67 6.85 5.71

Manufacturing -4.47 0.65 3.65 3.37 4.68 2.75 4.55 3.71 4.32 4.29 4.27 2.82 2.83 3.01 2.68 1.59 1.44

Trade, Transportation and Utilities -2.24 0.17 -0.31 0.33 -0.41 0.35 1.01 2.62 3.67 3.63 3.09 3.13 2.46 2.26 1.87 1.52 1.24

Transportation & Warehousing -1.86 -3.12 -1.74 0.24 0.64 4.15 6.21 7.52 6.57 6.80 5.66 5.66 4.69 4.35 3.50 3.37 2.92

Financial Activities -1.89 -2.00 -0.58 0.01 -0.66 2.16 2.44 2.82 2.60 2.07 1.07 1.78 0.42 -0.30 -0.49 0.03 -0.72

Education & Health 2.03 1.94 2.26 1.50 1.66 1.58 3.29 2.96 2.37 1.90 1.97 1.49 1.30 0.69 1.54 0.92 0.56

Professional & Business Services 1.55 2.82 3.28 6.17 8.15 7.30 6.85 5.96 4.96 3.95 3.88 4.37 4.01 3.23 3.24 3.26 3.49

Information -2.57 -3.48 -0.46 2.10 5.79 6.07 3.01 1.73 2.46 2.87 -0.35 0.67 1.03 2.02 1.10 0.63 0.21

Leisure & Hospitality -2.25 0.37 3.42 2.43 -0.83 0.01 0.34 -0.43 0.11 2.42 2.30 1.95 2.21 1.95 0.91 0.82 1.04

Government -0.05 -0.35 4.11 -5.14 -3.42 -1.17 -1.03 -0.47 -0.04 0.40 0.92 1.04 1.20 1.30 1.44 1.34 1.32

Federal 2.10 6.66 40.82 -21.28 -15.69 -3.59 -2.89 -1.91 -1.67 -1.33 -1.18 -1.19 -0.80 -0.80 -0.68 -0.68 -0.55

State & Local -0.36 -1.33 -0.61 -2.34 -1.45 -0.82 -0.76 -0.26 0.19 0.65 1.23 1.35 1.48 1.59 1.74 1.62 1.57

Employment (Millions)

Growth Rates



table 7. Quarterly Implicit Price deflators (2005=100)Table 7. Quarterly Implicit Price Deflators (2000=100)


GDP 109.9 110.1 110.8 111.3 111.3 111.8 112.3 112.7 113.1 113.7 114.1 114.6 115.1 115.7 116.2 116.7 117.1

Consumption 110.2 110.6 110.7 111.1 111.5 112.0 112.4 112.9 113.4 113.9 114.4 114.9 115.4 115.9 116.4 116.9 117.4

Durables 93.6 92.8 92.6 92.1 91.7 91.5 91.2 90.9 90.7 90.4 90.2 90.0 89.7 89.5 89.2 89.0 88.7

Motor Vehicles 101.2 102.1 102.9 103.0 103.0 103.3 103.5 103.7 103.9 104.2 104.4 104.6 104.8 105.0 105.2 105.3 105.5

Furniture 96.1 95.3 94.9 94.4 94.0 93.8 93.5 93.3 93.1 93.0 92.9 92.8 92.7 92.6 92.5 92.3 92.2

Other Durables 114.3 110.1 111.3 111.5 111.8 112.3 112.8 113.2 113.5 113.9 114.3 114.7 115.0 115.4 115.8 116.1 116.4

Nondurables 111.3 112.6 111.8 112.7 113.5 114.2 114.9 115.6 116.2 116.8 117.4 118.0 118.5 119.1 119.6 120.1 120.6

Food 112.7 113.2 113.9 114.4 114.8 115.4 115.7 116.0 116.4 116.9 117.3 117.8 118.4 118.9 119.4 119.8 120.3

Clothing & Shoes 98.9 98.6 97.9 97.5 97.4 97.5 97.5 97.5 97.5 97.4 97.4 97.4 97.3 97.3 97.3 97.2 97.1

Gasoline & Oil 118.2 124.7 117.2 121.4 124.9 126.2 127.8 130.6 132.3 134.0 135.0 136.1 137.1 138.2 139.2 140.1 140.9

Fuel 119.8 128.7 122.0 123.4 125.1 125.5 126.1 127.5 129.2 130.7 132.1 133.5 134.8 136.2 137.7 139.0 140.2

Services 113.0 113.4 113.8 114.2 114.6 115.2 115.7 116.2 116.8 117.4 118.0 118.6 119.3 120.0 120.6 121.2 121.9

Housing 112.5 112.3 112.1 112.2 112.5 112.8 113.2 113.7 114.2 114.8 115.4 116.1 116.7 117.3 118.0 118.6 119.2

Electricity 127.9 127.3 130.4 128.9 127.6 126.8 126.3 126.0 126.2 126.8 127.8 128.9 130.0 130.9 131.7 132.2 132.5

Natural Gas 86.2 91.1 91.4 89.7 85.6 84.7 83.4 82.3 82.4 81.8 82.3 85.8 90.4 92.3 92.0 91.2 92.7

Water & Sewer 127.1 129.4 131.5 132.5 133.1 133.6 134.4 135.3 136.4 137.4 138.4 139.5 140.6 141.7 142.9 144.0 145.1

Telephone 105.8 105.4 105.2 104.8 104.1 103.6 103.1 103.1 102.8 102.4 102.0 101.6 101.2 100.8 100.4 100.1 99.7

Transportation 116.6 117.1 117.8 118.3 118.6 119.5 120.1 120.6 121.1 121.7 122.3 122.8 123.4 124.0 124.6 125.1 125.6

Other Services 116.4 117.4 118.8 119.9 120.7 121.6 122.6 123.5 124.1 124.6 125.2 125.9 126.5 127.2 127.9 128.6 129.4



table 8. Percent Change in Implicit Price deflators

table 9. Annual Implicit Price deflators (2005=100)

Table 8. Percent Change in Implicit Price Deflators


GDP 0.5 0.9 2.6 1.6 0.1 2.0 1.6 1.5 1.5 1.9 1.6 1.7 1.8 2.1 1.6 1.6 1.7

Consumption 2.5 1.5 0.4 1.5 1.3 1.9 1.7 1.7 1.6 1.7 1.7 1.8 1.8 1.9 1.8 1.6 1.7

Durables -0.1 -3.6 -0.6 -2.1 -1.8 -1.0 -1.1 -1.2 -1.2 -1.1 -1.1 -1.0 -1.0 -1.0 -1.1 -1.2 -1.2

Motor Vehicles 8.7 3.7 3.0 0.5 0.0 1.2 1.0 0.7 0.9 0.8 0.8 0.8 0.9 0.8 0.7 0.6 0.6

Furniture -5.0 -3.4 -1.8 -1.9 -1.6 -1.2 -1.1 -1.0 -0.7 -0.4 -0.4 -0.5 -0.5 -0.5 -0.5 -0.6 -0.6

Other Durables 4.4 -13.8 4.4 0.6 1.4 1.7 1.7 1.4 1.3 1.3 1.4 1.3 1.3 1.3 1.3 1.1 1.1

Nondurables 3.9 4.7 -2.6 3.1 2.7 2.6 2.4 2.5 2.1 2.3 1.9 1.9 2.0 1.9 1.8 1.7 1.6

Food -0.1 1.9 2.4 1.7 1.4 2.1 1.3 1.0 1.3 1.7 1.7 1.7 1.8 1.8 1.7 1.5 1.5

Clothing & Shoes -2.2 -1.3 -2.6 -1.5 -0.6 0.6 -0.1 0.0 -0.2 -0.1 -0.2 -0.1 -0.1 -0.1 -0.2 -0.3 -0.3

Gasoline & Oil 28.2 23.8 -22.0 15.5 12.0 4.0 5.3 9.0 5.2 5.4 3.1 3.1 3.1 3.2 3.0 2.5 2.2

Fuel 48.3 33.1 -19.2 4.8 5.6 1.2 2.1 4.5 5.4 4.6 4.4 4.2 4.1 4.2 4.3 3.8 3.7

Services 2.4 1.3 1.5 1.5 1.3 2.0 1.9 1.9 1.9 2.0 2.1 2.2 2.3 2.3 2.2 2.1 2.1

Housing -0.6 -0.5 -0.6 0.2 0.9 1.2 1.4 1.7 1.9 2.1 2.2 2.2 2.2 2.2 2.2 2.2 2.2

Electricity 8.2 -1.7 9.9 -4.5 -4.0 -2.4 -1.5 -0.8 0.4 2.0 3.1 3.6 3.5 3.0 2.4 1.4 1.1

Natural Gas -0.2 25.1 1.0 -7.0 -17.0 -4.5 -5.9 -5.1 0.6 -2.7 2.3 18.0 23.1 9.0 -1.3 -3.6 6.7

Water & Sewer 6.4 7.5 6.6 3.2 1.8 1.6 2.3 2.8 3.0 3.1 3.1 3.0 3.2 3.3 3.4 3.2 3.1

Telephone -0.7 -1.6 -0.9 -1.3 -2.9 -1.9 -1.7 0.0 -1.3 -1.4 -1.6 -1.3 -1.6 -1.6 -1.5 -1.5 -1.7

Transportation 3.7 1.8 2.5 1.6 1.2 2.9 1.8 1.8 1.7 2.1 1.8 1.8 1.9 2.0 1.8 1.7 1.8

Other Services 5.2 3.3 5.0 3.7 2.8 3.1 3.1 3.0 2.1 1.8 1.9 2.2 2.0 2.1 2.2 2.3 2.3

Table 9. Annual Implicit Price Deflators (2000=100)

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

GDP 92.1 94.1 96.8 100.0 103.3 106.2 108.5 109.7 110.9 112.5 114.4 116.4Consumption 92.7 94.6 97.1 100.0 102.7 105.5 109.0 109.2 111.0 112.7 114.6 116.7Durables 106.7 102.9 101.0 100.0 98.5 96.7 95.5 94.0 92.3 91.1 90.1 89.1Motor Vehicles 101.9 99.1 98.4 100.0 100.1 99.5 98.5 98.7 102.7 103.6 104.5 105.3Furniture 104.1 101.2 99.9 100.0 99.5 98.7 98.0 97.7 94.7 93.4 92.9 92.4Other Durables 103.3 101.6 101.4 100.0 101.9 106.1 111.5 113.3 111.2 112.9 114.5 115.9Nondurables 90.9 92.8 96.1 100.0 103.2 106.3 112.2 109.0 112.6 115.2 117.7 119.9Food 93.5 95.3 98.3 100.0 101.7 105.6 111.9 113.3 114.1 115.9 117.6 119.6Clothing & Shoes 103.9 101.3 100.9 100.0 99.6 98.6 97.8 98.7 97.8 97.5 97.4 97.2Gasoline & Oil 59.9 69.8 82.1 100.0 112.8 122.4 142.2 103.7 122.0 129.2 135.6 139.6Fuel 53.1 64.2 74.7 100.0 114.1 121.9 166.2 111.4 124.8 127.1 132.8 138.3Services 90.8 93.7 96.7 100.0 103.4 107.0 110.6 112.3 114.0 116.0 118.3 120.9Housing 93.0 95.4 97.6 100.0 103.6 107.4 110.4 112.4 112.3 113.5 115.7 118.3Electricity 90.3 92.5 94.2 99.9 112.0 116.5 123.9 127.7 128.5 126.3 128.3 131.8Natural Gas 62.8 77.2 83.6 100.2 102.6 101.4 115.4 89.9 89.5 83.2 85.1 92.1Water & Sewer 86.5 89.7 95.0 100.0 104.9 110.2 116.7 123.9 131.6 134.9 139.0 143.5Telephone 102.7 102.3 100.7 100.0 100.6 102.4 104.1 105.7 104.9 103.2 101.8 100.2Transportation 93.1 95.1 96.5 100.0 104.2 106.6 112.4 115.5 118.0 120.3 122.6 124.8Other Services 87.0 91.2 95.4 100.0 104.1 107.3 112.4 115.0 119.2 122.9 125.6 128.3

ForecastHistory



table 10. Percent Change in Implicit Price deflators

table 11. Personal Income and its Components

Table 10. Percent Change in Implicit Price Deflators

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

GDP 1.8 2.1 3.2 3.5 2.9 2.7 2.0 0.7 1.3 1.6 1.8 1.7Consumption 2.0 1.9 3.0 3.3 1.9 3.6 1.8 1.2 1.2 1.7 1.8 1.7Durables -2.6 -4.0 -0.8 -1.2 -1.7 -1.8 -1.3 -1.2 -2.1 -1.1 -1.0 -1.1Motor Vehicles -0.7 -3.8 1.6 1.0 -0.6 0.3 -2.9 4.5 1.8 1.0 0.8 0.7Furniture -2.0 -3.1 -0.1 -0.4 -0.2 -1.6 0.3 -1.9 -2.2 -1.0 -0.4 -0.5Other Durables -2.3 -1.5 -0.1 0.0 3.3 2.9 5.9 1.3 -1.9 1.5 1.3 1.2Nondurables 1.9 2.1 4.9 4.4 0.5 6.5 0.8 2.3 2.0 2.4 2.0 1.8Food 0.8 3.2 2.7 1.5 1.7 4.7 6.9 -1.7 1.8 1.4 1.7 1.6Clothing & Shoes -1.9 -1.6 -0.5 -1.3 0.2 -1.2 -0.9 1.6 -1.5 0.1 -0.1 -0.2Gasoline & Oil 19.8 19.4 28.8 31.8 -0.8 31.5 0.7 20.5 7.3 5.9 3.7 2.7Fuel 7.2 21.3 41.6 32.8 -0.4 33.0 16.5 -4.8 6.1 3.3 4.3 4.0Services 3.0 3.2 3.2 3.8 3.1 3.6 2.9 1.3 1.4 1.9 2.2 2.2Housing 3.4 2.2 2.4 2.5 4.4 3.1 2.6 0.9 0.0 1.6 2.2 2.2Electricity -2.2 3.2 1.8 10.2 8.6 5.1 8.3 -0.1 -0.1 -1.1 3.0 2.0Natural Gas 5.3 22.2 14.7 44.7 -18.3 3.2 18.0 -19.2 0.5 -3.7 10.2 2.7Water & Sewer 3.1 4.6 5.9 5.0 4.9 5.2 6.8 6.0 4.8 2.4 3.1 3.2Telephone 1.0 -1.7 -1.7 0.2 1.3 1.5 2.1 0.8 -1.7 -1.2 -1.5 -1.6Transportation 1.3 2.6 1.4 4.9 2.5 3.4 5.9 1.8 1.8 2.1 1.9 1.8Other Services 4.5 4.9 4.4 4.6 4.0 3.3 4.6 2.3 3.7 2.8 2.0 2.2

ForecastHistory

Table 11. Personal Income and its Components

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Personal Income 9060.1 9378.2 9937.3 10485.9 11268.1 11894.1 12238.8 12026.1 12417.5 12965.6 13585.1 14222.0Wages & Salaries 6110.8 6382.6 6693.4 7065.1 7477.0 7856.5 8037.4 7791.6 7947.3 8306.8 8727.8 9157.5Other Labor Income 747.4 845.6 874.6 931.6 960.2 993.0 1023.9 1043.9 1072.8 1124.8 1190.3 1253.2Nonfarm Income 871.9 894.1 984.1 1025.9 1103.6 1056.9 1057.5 1011.7 1058.5 1121.5 1175.7 1230.0Farm Income 18.5 36.5 49.7 43.9 29.4 39.5 48.7 29.3 32.3 39.3 41.7 41.1Rental income 218.8 204.2 198.4 178.2 146.5 144.9 210.4 268.1 308.7 303.5 256.9 198.1Dividends 397.7 423.1 548.3 555.0 702.2 765.1 686.5 554.2 582.7 663.6 681.9 718.8Interest Income 911.9 889.8 860.2 987.0 1127.5 1266.4 1308.0 1238.5 1241.4 1286.8 1461.4 1642.9Transfer Payments 1282.2 1341.8 1415.5 1508.6 1605.0 1718.0 1875.9 2104.8 2234.8 2288.4 2349.0 2431.0Personal Social Insurance Tax 385.3 396.5 419.2 445.2 475.1 498.5 517.9 508.4 520.6 547.0 586.6 647.9

Personal Income 2.0 3.5 6.0 5.5 7.5 5.6 2.9 -1.7 3.3 4.4 4.8 4.7Wages & Salaries 2.2 4.4 4.9 5.6 5.8 5.1 2.3 -3.1 2.0 4.5 5.1 4.9Other Labor Income 11.7 13.2 3.5 6.5 3.1 3.4 3.1 2.0 2.8 4.8 5.8 5.3Nonfarm Income 3.8 2.5 10.1 4.3 7.6 -4.2 0.1 -4.3 4.6 6.0 4.8 4.6Farm Income -38.8 113.5 38.7 -11.1 -32.7 33.9 26.8 -37.8 11.2 22.6 6.2 -1.4Rental income -13.1 14.9 -9.4 -10.9 -23.8 35.2 41.5 21.3 13.5 -9.8 -20.1 -21.6Dividends 7.6 14.0 43.3 -0.6 26.8 -0.4 -10.9 -13.4 14.4 6.6 3.2 5.9Interest Income -6.5 -2.2 0.2 19.4 10.9 14.4 -2.1 -4.3 0.7 7.2 15.6 10.7Transfer Payments 5.7 4.5 6.0 6.3 6.7 7.6 9.6 14.3 4.5 2.4 3.2 3.9Personal Social Insurance Tax 3.2 4.2 6.1 5.9 6.7 5.1 2.8 -2.2 3.8 5.1 7.9 10.6

Percent Change, Annual Rate

Personal Income Billions Current Dollars

ForecastHistory



table 12. Personal Consumption Expenditures (Current dollars)Table 12. Personal Consumption Expenditures (Current Dollars)


Consumer spending on… all goods & services 10236.4 10367.1 10429.3 10525.7 10627.6 10733.7 10841.7 10962.5 11091.6 11196.9 11308.9 11414.4 11518.3 11601.4 11695.1 11781.4 11876.2 durable goods 1052.0 1070.6 1086.1 1095.0 1104.9 1117.3 1129.2 1149.3 1175.4 1195.9 1205.3 1211.8 1214.6 1222.9 1230.5 1228.9 1227.9 furniture and appliances 255.2 261.6 264.8 265.9 266.1 268.9 269.4 270.6 272.2 274.9 277.9 280.0 281.6 283.0 284.2 283.8 283.4 information processing equipment 67.2 69.6 70.3 71.1 71.8 72.1 72.9 73.8 74.9 75.5 76.5 77.6 78.7 79.3 80.2 81.1 82.2 motor vehicles and parts 319.6 321.9 332.8 338.3 346.1 352.4 360.5 375.5 395.7 410.5 412.6 413.4 410.5 414.1 417.1 414.2 412.0 other durable goods 97.7 100.2 100.4 101.2 101.8 102.6 103.2 103.8 104.7 104.7 105.0 105.3 105.8 106.1 106.3 106.4 106.4 nondurables 2285.1 2333.5 2329.4 2356.8 2384.6 2407.0 2432.1 2459.9 2485.2 2505.3 2527.5 2548.9 2570.6 2585.9 2603.6 2622.4 2641.5 clothing & shoes 329.0 336.0 337.3 338.5 340.9 340.3 341.8 344.1 346.7 345.8 347.9 349.4 351.1 349.5 350.4 352.0 354.3 fuel oil & coal 22.9 24.7 22.9 23.9 23.9 23.6 23.5 23.7 24.1 24.4 24.6 24.9 25.1 25.4 25.7 26.0 26.2 gasoline & motor oil 321.1 339.9 320.4 332.1 341.4 344.1 347.6 355.0 359.6 363.7 365.7 368.7 371.6 373.7 375.4 377.7 379.6 food 798.7 808.9 816.9 826.5 836.1 845.8 854.8 863.1 871.2 878.2 885.7 893.0 900.1 905.9 911.8 917.6 923.7 other nondurable goods 813.3 824.0 832.0 835.8 842.3 853.3 864.5 874.0 883.6 893.2 903.6 913.0 922.7 931.4 940.3 949.2 957.7

Consumer spending on… all goods & services 9289.5 9372.7 9419.8 9472.6 9533.7 9584.8 9641.5 9708.2 9783.4 9833.5 9889.6 9937.0 9982.0 10007.7 10044.8 10078.3 10117.8 durable goods 1123.7 1154.2 1172.5 1188.5 1204.7 1221.3 1237.8 1263.8 1296.3 1322.4 1336.4 1347.1 1353.8 1366.5 1378.8 1381.1 1384.2 furniture and appliances 265.5 274.5 279.1 281.7 283.0 286.7 288.0 290.0 292.3 295.5 299.0 301.7 303.8 305.6 307.3 307.3 307.4 information processing equipment 108.8 114.0 118.1 122.5 126.9 131.0 135.8 141.0 146.7 151.8 157.9 164.2 171.0 176.9 183.6 190.8 198.3 motor vehicles and parts 316.3 315.6 323.6 328.5 336.2 341.3 348.2 362.1 380.6 394.2 395.4 395.3 391.6 394.3 396.5 393.2 390.5 other durable goods 82.8 89.2 88.1 88.7 88.9 89.3 89.5 89.9 90.4 90.3 90.3 90.4 90.6 90.7 90.7 90.6 90.5 nondurables 2053.4 2073.2 2082.8 2091.2 2101.6 2107.7 2117.2 2128.3 2139.2 2144.3 2153.0 2160.9 2168.8 2171.1 2176.2 2183.0 2190.1 clothing & shoes 332.7 340.9 344.5 347.0 350.0 348.9 350.5 352.9 355.7 354.9 357.2 358.8 360.7 359.2 360.3 362.2 364.8 fuel oil & coal 19.0 19.1 18.8 19.3 19.1 18.8 18.6 18.6 18.7 18.7 18.6 18.6 18.6 18.6 18.6 18.7 18.7 gasoline & motor oil 271.6 272.6 273.5 273.5 273.3 272.7 271.9 271.8 271.9 271.4 270.8 270.9 271.0 270.3 269.6 269.6 269.4 food 708.5 714.1 717.2 722.6 728.5 733.1 738.5 744.0 748.6 751.5 754.7 757.7 760.4 761.8 763.7 765.7 767.9 other nondurable goods 724.5 730.2 732.9 732.9 735.3 738.7 742.3 746.0 749.7 753.1 757.2 760.6 764.2 767.0 770.1 773.3 776.1

Consumer spending on… all goods & services 1.6 3.6 2.0 2.2 2.6 2.1 2.4 2.8 3.1 2.1 2.3 1.9 1.8 1.0 1.5 1.3 1.6 durable goods 0.4 10.8 6.3 5.5 5.5 5.5 5.4 8.4 10.3 8.1 4.2 3.2 2.0 3.8 3.6 0.7 0.9 furniture and appliances 11.0 13.6 6.7 3.7 1.9 5.3 1.8 2.8 3.1 4.4 4.7 3.6 2.8 2.5 2.2 0.1 0.0 information processing equipment 20.7 19.2 14.5 15.0 14.2 12.8 14.8 15.4 16.2 13.9 15.9 16.1 16.5 13.8 15.3 15.6 15.7 motor vehicles and parts -22.5 -0.8 10.1 6.2 9.3 6.1 8.1 15.9 20.5 14.2 1.3 -0.1 -3.7 2.7 2.3 -3.4 -2.7 other durable goods -2.8 31.3 -5.1 2.7 0.8 1.7 1.1 1.7 2.4 -0.7 0.2 0.3 0.8 0.4 0.2 -0.4 -0.4 nondurables 4.0 3.9 1.8 1.6 2.0 1.2 1.8 2.1 2.0 1.0 1.6 1.5 1.5 0.4 0.9 1.2 1.3 clothing & shoes 7.4 9.9 4.2 2.9 3.5 -1.3 1.8 2.7 3.2 -0.9 2.6 1.8 2.1 -1.7 1.2 2.1 2.8 fuel oil & coal 20.4 1.5 -6.7 11.3 -5.2 -5.7 -3.7 -0.7 1.8 0.3 -1.5 0.2 -1.1 1.3 -0.2 0.9 0.8 gasoline & motor oil -3.8 1.4 1.3 0.0 -0.3 -0.9 -1.1 -0.2 0.0 -0.8 -0.8 0.2 0.1 -1.0 -1.1 -0.1 -0.2 food 4.9 3.2 1.7 3.1 3.3 2.6 3.0 3.0 2.5 1.6 1.8 1.6 1.4 0.8 1.0 1.1 1.2 other nondurable goods 4.4 3.2 1.5 0.0 1.3 1.8 2.0 2.0 2.0 1.8 2.2 1.8 1.9 1.5 1.6 1.7 1.5

Real Consumer Expenditures Annual Growth Rate

Consumer Expenditures by Type Billions 2005 Dollars

Consumer Expenditures by Type Billions Current Dollars



table 13. Personal Consumption Expenditures (2005 dollars)Table 13. Personal Consumption Expenditures (2000 Dollars)

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Consumer spending on… all goods & services 7439.2 7804.0 8285.1 8819.0 9322.7 9826.4 10129.9 10089.1 10487.4 10907.4 11359.6 11738.5 durable goods 992.1 1014.8 1061.6 1105.5 1133.0 1160.5 1095.2 1035.0 1089.1 1142.8 1206.9 1227.5 furniture and appliances 225.9 233.3 249.2 263.9 276.5 279.8 270.1 253.5 264.6 270.2 278.6 283.6 information processing equipment 44.5 46.6 51.5 55.9 60.4 65.3 66.3 65.3 70.7 73.5 77.1 80.7 motor vehicles and parts 401.3 401.5 404.7 409.6 397.1 400.3 342.3 312.8 334.8 371.0 411.8 414.3 other durable goods 79.3 82.4 87.0 90.4 95.7 99.5 98.3 96.3 100.9 103.6 105.2 106.3 nondurables 1617.9 1712.6 1830.7 1968.4 2088.7 2204.5 2308.0 2220.2 2351.1 2446.1 2538.1 2613.3 clothing & shoes 278.8 287.0 300.0 315.5 330.1 341.2 337.5 325.8 338.2 343.2 348.6 351.6 fuel oil & coal 14.3 16.8 18.4 21.0 22.3 24.1 26.6 21.1 23.8 23.7 24.7 25.8 gasoline & motor oil 160.3 192.8 231.6 283.8 314.7 343.9 386.4 283.6 333.5 351.6 367.4 376.6 food 569.6 593.1 628.2 665.0 698.0 740.1 784.3 790.2 822.1 858.7 889.2 914.7 other nondurable goods 594.9 622.9 652.6 683.0 723.7 755.2 773.1 799.4 833.5 868.9 908.1 944.6

Consumer spending on… all goods & services 8021.9 8247.6 8532.7 8819.0 9073.5 9313.9 9290.9 9235.1 9449.7 9679.5 9910.5 10062.1 durable goods 930.0 986.1 1051.0 1105.5 1150.4 1199.9 1146.3 1101.4 1180.0 1254.8 1339.9 1377.6 furniture and appliances 217.0 230.6 249.3 263.9 277.9 283.6 275.5 259.4 279.6 289.3 300.0 306.9 information processing equipment 28.3 36.0 44.8 55.9 69.2 82.4 92.6 101.5 120.4 138.6 161.2 187.4 motor vehicles and parts 394.0 405.3 411.3 409.6 396.6 402.4 347.5 317.2 326.0 358.1 394.1 393.6 other durable goods 74.7 79.4 84.7 90.4 94.1 93.0 85.8 82.5 88.7 89.8 90.4 90.6 nondurables 1780.2 1845.6 1904.6 1968.4 2023.6 2074.8 2057.3 2037.0 2087.2 2123.1 2156.7 2180.1 clothing & shoes 268.5 283.4 297.3 315.5 331.5 345.9 345.0 330.1 345.6 352.0 357.9 361.6 fuel oil & coal 26.9 26.2 24.6 21.0 19.5 19.7 16.0 18.8 19.1 18.7 18.6 18.7 gasoline & motor oil 267.5 276.3 282.1 283.8 278.9 280.9 271.7 273.5 273.2 272.1 271.0 269.7 food 609.0 622.4 639.2 665.0 686.2 700.7 700.7 697.4 720.6 741.0 756.1 764.8 other nondurable goods 612.5 640.1 662.6 683.0 708.4 729.4 728.7 720.1 732.8 744.2 758.8 771.6

Consumer spending on… all goods & services 1.9 3.4 3.5 2.7 3.3 2.0 -1.8 1.0 2.6 2.6 2.0 1.4 durable goods 1.7 9.2 5.5 2.4 6.5 4.6 -11.7 4.8 7.2 7.6 4.5 2.3 furniture and appliances 5.8 9.4 6.1 6.8 2.6 2.5 -7.3 0.9 6.7 3.3 3.9 1.2 information processing equipment 29.8 30.1 21.4 25.1 22.5 21.1 6.3 15.1 16.7 15.6 16.5 16.0 motor vehicles and parts -4.3 5.9 1.7 -6.6 5.8 0.7 -23.7 5.8 6.4 13.4 3.1 -0.2 other durable goods 8.1 9.1 4.2 6.8 1.2 0.6 -14.6 4.3 8.4 1.7 0.2 -0.1 nondurables 2.1 4.0 3.0 3.3 3.2 1.5 -2.8 1.4 2.3 1.8 1.4 1.0 clothing & shoes 3.9 5.6 5.1 7.4 3.9 3.5 -3.7 -0.6 5.2 1.6 1.4 1.1 fuel oil & coal 10.2 1.7 -15.6 -16.2 6.1 -7.9 -1.3 17.7 0.4 -2.0 -0.5 0.7 gasoline & motor oil 0.6 4.8 0.7 -0.6 -0.4 0.3 -3.3 0.4 0.6 -0.5 -0.3 -0.6 food 1.0 1.6 3.9 4.2 3.4 1.3 -2.8 3.2 2.8 2.8 1.6 1.0 other nondurable goods 2.7 5.6 2.7 2.9 4.4 1.8 -1.7 0.6 1.5 2.0 1.9 1.6

Real Consumer Expenditures Annual Growth Rate

Consumer Expenditures by Type Billions 2005 Dollars

Consumer Expenditures by Type Billions Current Dollars

ForecastHistory



table 14. Business Fixed InvestmentTable 14. Business Fixed Investment

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Business Fixed Investment 1125.4 1135.7 1223.0 1347.3 1505.3 1640.2 1693.6 1388.8 1407.7 1491.9 1666.5 1848.2Producers Dur. Equipment 842.7 853.8 916.4 995.6 1071.7 1104.8 1084.1 908.8 1004.9 1125.0 1247.6 1349.5Nonresidential Structures 282.8 281.9 306.7 351.8 433.7 535.3 609.5 480.0 402.8 366.9 419.0 498.7Non-Farm Buildings 188.1 182.1 196.7 212.9 247.6 298.9 328.3 278.8 200.5 193.0 243.2 313.5Commercial 99.8 94.6 104.3 112.9 128.4 150.8 151.3 104.4 72.1 68.5 93.0 131.9Industrial 22.7 21.4 23.7 29.9 35.1 45.3 60.8 75.9 52.7 47.9 61.8 78.5Other Buildings 65.6 66.0 68.7 70.2 84.1 102.8 116.3 98.6 75.8 76.7 88.4 103.1Utilities 56.3 53.5 48.6 51.4 61.1 82.8 103.4 104.1 97.2 89.7 94.2 97.8Mines & Wells 30.2 38.4 51.9 77.1 114.2 142.5 165.9 87.5 95.7 74.7 71.3 76.6

Business Fixed Investment 1180.2 1191.0 1263.0 1347.3 1453.9 1544.3 1569.7 1291.0 1337.4 1425.3 1580.9 1733.0Producers Dur. Equipment 830.3 851.4 917.3 995.6 1069.6 1097.0 1068.6 890.7 1001.6 1127.0 1245.8 1342.7Nonresidential Structures 356.6 343.0 346.7 351.8 384.0 441.4 486.8 390.3 338.1 309.9 347.1 399.3Non-Farm Buildings 222.3 210.0 213.9 212.9 229.2 262.1 277.4 234.4 173.1 161.3 194.8 240.1Commercial 119.5 110.3 114.4 112.9 118.4 131.1 126.3 84.9 60.3 55.8 72.8 98.8Industrial 26.2 24.3 25.5 29.9 33.0 40.4 50.6 61.5 43.3 37.5 46.1 56.0Other Buildings 76.6 75.4 74.1 70.2 77.9 90.7 100.8 88.2 70.0 69.0 76.5 85.3Utilities 66.0 61.3 52.1 51.4 56.2 73.0 85.8 84.9 79.3 72.7 74.8 75.7Mines & Wells 52.6 60.0 69.9 77.1 88.3 97.1 112.7 65.9 78.1 68.5 68.9 74.1

Business Fixed Investment -6.3 6.2 9.5 8.4 11.7 9.8 -3.2 -15.0 4.6 7.6 13.5 9.1Producers Dur. Equipment -4.1 6.7 8.5 6.3 6.9 3.5 -8.8 -6.2 12.4 11.1 11.2 6.5Nonresidential Structures -12.0 4.8 12.6 14.9 25.2 24.9 8.0 -29.3 -12.2 -1.7 20.5 16.6Non-Farm Buildings -14.5 3.8 10.8 7.3 18.7 23.4 2.5 -27.7 -16.9 4.5 35.1 24.4Commercial -15.3 4.3 9.3 10.0 15.3 17.2 -10.0 -39.8 -19.4 6.0 50.0 36.1Industrial -31.9 9.1 30.4 13.8 16.1 52.1 34.9 1.4 -18.6 -2.0 42.3 18.5Other Buildings -4.4 2.5 9.2 1.7 26.0 22.6 6.7 -26.8 -12.1 7.9 17.5 15.5Utilities -10.7 -3.7 5.5 3.8 23.9 46.9 8.7 3.2 -12.0 1.0 3.5 5.9Mines & Wells 9.1 29.4 38.0 51.3 50.0 17.6 21.8 -23.9 6.4 -18.1 3.1 4.3

Billions Current Dollars

Billions 2005 Dollars

ForecastHistory

Annual Growth Rate



table 15. government receipts and ExpendituresTable 15. Government Receipts and Expenditures

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Receipts 1859.3 1885.1 2014.0 2290.1 2524.5 2660.8 2475.0 2226.7 2374.4 2671.5 2886.5 3221.7Personal Tax and Nontax Receipts 828.6 774.2 799.2 931.9 1049.9 1168.1 1102.5 829.5 878.0 1015.4 1191.5 1412.9Corp. Profits Tax Accruals 150.5 197.8 250.3 341.0 395.0 370.2 212.3 231.0 319.8 424.9 396.4 412.7Indirect Business Tax and Nontax Accruals 86.8 89.3 94.3 98.8 99.4 94.7 92.0 92.3 100.1 105.6 109.3 114.3Contributions for Social Insurance 739.3 762.8 807.6 852.6 904.6 944.4 974.5 950.2 971.0 1027.1 1092.0 1179.2

Expenditures 2112.1 2261.5 2393.4 2573.1 2728.3 2897.2 3117.6 3451.3 3666.2 3652.9 3738.1 3861.0Purchases Goods & Services 680.7 756.5 824.7 876.3 931.7 976.7 1082.6 1144.9 1206.8 1204.0 1187.3 1191.5National Defense 437.7 498.0 550.8 589.1 624.9 662.1 737.9 779.1 817.2 809.0 785.8 782.1Other 243.0 258.6 273.9 287.3 306.9 314.6 344.7 365.8 389.6 395.0 401.5 409.4Transfer Payments 1252.1 1339.4 1405.1 1491.3 1587.1 1688.6 1840.6 2134.4 2281.4 2242.7 2267.3 2328.7To Persons 914.9 962.6 1014.3 1078.0 1180.7 1254.2 1388.2 1596.1 1703.5 1709.5 1732.3 1772.1To Foreigners 23.3 28.6 30.9 40.9 35.0 42.2 44.8 46.0 45.7 44.9 45.7 46.6Grants in Aid to State & local Gov't 304.2 338.0 349.2 361.2 359.0 378.9 391.7 476.6 516.0 471.3 471.5 491.3Net Interest 213.7 196.5 204.6 239.0 261.0 290.7 272.3 248.4 262.0 293.6 367.8 424.7Subsidies less Surplus of Gov't Entities 40.3 45.3 45.7 64.1 53.9 50.3 54.3 63.1 59.8 54.5 51.7 50.4Surplus (+) or Deficit (-) -252.8 -376.4 -379.5 -283.0 -203.8 -236.5 -642.6 -1224.7 -1291.9 -981.4 -851.6 -639.3

Receipts 1412.7 1496.3 1601.0 1730.5 1829.7 1927.4 1974.2 1995.5 2093.1 2118.3 2203.4 2301.0Personal Tax/Nontax Receipts 928.7 977.7 1059.4 1163.1 1249.1 1313.4 1336.2 1263.1 1308.2 1366.0 1435.4 1499.9Corporate Profits 221.8 226.2 248.6 276.7 302.5 322.8 330.0 273.0 280.6 302.3 328.1 352.2Indirect Business Tax and Nontax Accruals 30.9 34.0 41.7 55.0 59.1 56.6 51.0 58.5 71.4 70.1 70.8 71.7Contributions for Social Insurance 15.9 20.1 24.1 24.8 21.8 19.8 21.1 21.9 22.3 22.6 23.1 24.0Federal Grants-In-Aid 304.2 338.0 349.2 361.2 359.0 378.9 391.7 476.6 516.0 471.3 471.5 491.3

Expenditures 1466.78 1535.13 1609.33 1704.50 1778.63 1905.63 2014.40 2014.63 2061.92 2126.76 2203.39 2301.4Purchases Goods & Services 1302.7 1356.1 1408.2 1493.6 1586.7 1699.8 1800.6 1785.9 1801.7 1834.2 1875.0 1943.6 Government Social Benefits 333.0 353.4 384.3 404.8 402.9 433.7 455.0 475.9 497.9 544.9 580.5 618.6Transfer Payments 333.0 353.4 384.3 404.8 402.9 433.7 455.0 475.9 497.9 544.9 580.5 618.6Interest Received 12.0 20.6 19.0 10.9 2.1 -2.6 3.9 5.0 7.6 6.3 6.5 10.8Net Subsidies -5.2 -3.2 -0.6 0.3 1.7 11.0 6.1 4.6 3.8 2.5 -1.3 -2.1Dividends Received 1.6 1.7 2.0 2.1 2.3 2.5 2.9 2.8 2.6 2.8 2.9 3.0Net Wage Accruals 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Surplus (+) or Deficit (-) -54.1 -38.8 -8.4 26.0 51.0 21.7 -40.2 -19.2 31.1 -8.5 0.0 -0.4

State and Local Government Receipts and Expenditures

Federal Government Receipts and Expenditures

ForecastHistory



table 16. U.s. Exports and Imports of goods and servicesTable 16. U.S. Exports and Imports of Goods and Services

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Net Exports Goods & Services -427.2 -504.1 -618.7 -722.7 -769.3 -713.8 -707.8 -392.3 -469.2 -507.8 -538.9 -494.6Current Account -459.1 -521.5 -631.1 -748.7 -803.5 -726.6 -706.1 -419.9 -514.1 -566.6 -620.1 -584.6Exports -Goods & Services 1003.0 1041.0 1180.2 1305.1 1471.1 1656.0 1831.1 1564.2 1807.2 1975.5 2146.1 2360.6Merchandise Balance -482.8 -549.0 -671.8 -790.9 -847.3 -831.0 -840.3 -517.0 -584.7 -628.9 -677.8 -662.3Food, Feed & beverage 49.60 55.03 56.55 58.95 65.98 84.28 108.35 93.98 102.71 108.45 114.85 121.35Industrial Supplies Excl Petroleum 153.5 168.3 199.5 227.5 267.3 303.1 369.4 282.6 361.0 400.0 434.0 470.6Motor Vehicles & Parts 78.9 80.7 89.2 98.4 107.3 121.3 121.5 81.9 110.4 122.5 142.6 167.0Capital Goods, Excl. MVP 290.5 293.7 327.6 358.4 404.1 433.0 457.7 390.9 462.0 521.5 571.7 644.9Computer Equipment 38.6 39.9 42.8 45.5 47.6 45.6 43.9 37.7 45.2 49.6 55.5 61.8Other 201.5 207.1 238.7 257.0 291.9 314.5 339.8 278.4 335.7 383.7 423.5 480.8Consumer Goods, Excl. MVP 84.4 89.9 103.3 115.3 129.1 146.0 161.3 150.1 168.2 182.1 194.3 212.2Other Consumer 43.5 39.4 41.0 47.5 50.8 51.8 48.8 38.9 41.5 46.9 51.4 55.9Services 302.8 314.2 363.3 399.0 446.7 516.5 564.2 525.9 561.4 594.2 637.2 688.6

Imports -Goods & Services 1430.2 1545.2 1798.9 2027.8 2240.4 2369.7 2538.9 1956.6 2276.4 2483.2 2685.0 2855.2Merchandise 1193.9 1289.3 1501.7 1708.0 1884.9 1987.7 2126.4 1575.4 1863.4 2043.4 2220.5 2367.5Food, Feed & Beverage 49.7 55.8 62.1 68.1 75.0 81.7 89.0 81.8 88.1 91.8 96.7 100.9Petroleum & Products 103.5 133.1 180.5 251.9 302.5 331.0 453.3 253.5 306.8 350.9 379.1 396.9Industrial Supplies Excl Petroleum 159.6 175.7 226.4 266.0 291.4 295.7 316.5 194.6 253.0 274.5 296.9 322.2Motor Vehicles & Parts 203.8 210.1 228.2 239.5 256.6 259.3 233.8 160.5 210.6 224.8 260.6 284.8Capital Goods, Excl. MVP 284.0 296.4 344.5 380.8 420.0 446.0 455.2 369.6 436.4 494.2 543.8 587.3Computer Equipment 75.2 76.5 88.6 93.3 101.4 105.2 100.9 93.6 124.4 131.8 140.2 149.4Other 183.3 195.8 231.6 261.7 290.2 306.5 318.9 245.6 278.4 322.6 360.1 389.8Consumer Goods, Excl. MVP 310.7 337.7 377.2 411.5 446.1 478.2 484.8 431.0 474.7 507.1 534.4 557.9Other Consumer 82.7 80.5 82.9 90.3 93.5 95.9 94.0 84.5 93.9 100.1 108.9 117.5Services 236.4 255.9 297.3 319.8 355.4 382.1 412.4 381.2 413.0 439.8 464.6 487.7

Net Exports Goods & Services -548.8 -604.0 -688.0 -722.7 -729.2 -647.7 -494.3 -355.6 -386.7 -419.2 -431.2 -375.1Exports G & S 1099.2 1116.8 1222.8 1305.1 1422.1 1546.2 1629.3 1472.4 1644.2 1758.9 1879.7 2040.5Imports G & S 1648.0 1720.7 1910.8 2027.8 2151.2 2193.8 2123.5 1828.0 2030.9 2178.1 2311.0 2415.6

Exports G & S 5.6 9.0 11.7 10.3 14.0 15.4 -0.8 2.6 11.8 8.3 9.2 10.0Imports G & S 13.4 8.0 19.1 12.1 5.4 9.9 -3.2 1.1 11.6 7.9 7.7 5.5Real Exports G & S 4.2 6.6 7.1 6.8 10.4 10.4 -2.8 1.6 9.0 5.9 7.6 8.8Real Imports G & S 9.7 5.4 11.0 5.2 4.2 1.0 -6.6 -3.5 10.6 5.8 5.9 3.8

Forecast

Billions of Dollars

Billions 2005 Dollars

Exports & Imports % Change

History

Billions of Dollars

The UCF College of Business Administration would like to thank Alan C. Charron, ‘84, for his generous gift to the Institute for Economic Competitiveness. His support enables the Institute to publish this forecast and will help fund future activities and research. Charron graduated in 1984 with a degree in finance. He is president of Real Property Specialists, Inc., located in Orlando, Florida.

Founded in 1992, Real Property Specialists, Inc., is a full-service brokerage company that has built a reputation of providing highly personalized service while being respon-sive and flexible to its clients' individual needs. They offer a range of commercial real estate services in the Central Florida area including brokerage, appraisal, development, property management and tenant representation.

Real Property Specialists, Inc., has set a new standard of excellence in client service by providing these key advan-tages over the competition:

Responsiveness. You work directly with a decision maker who has the flexibility to immediately attend to your needs.

Consistency. We are a unified firm employing team-

members who are committed to the success of our clients. We pride ourselves on our ability to maintain a dedicated, professional staff that is able to build long-term, comfort-able and prosperous relationships with our clients.

Accountability. At Real Property Specialists, our cli-ent is the real "Boss." We are accountable to no one other than the client. No company policy interferes with our ability to serve the individual needs of each client.

Experience. The staff at Real Property Specialists is highly qualified, with most associates having more than a decade of experience in the industry. Our personal port-folio of shopping centers gives us first-hand knowledge of what is important when leasing, managing or selling a property.

AppeciationIn

Appraisers • Brokers • Consultants6700 Conroy-Windermere Road, Suite 230 | Orlando, FL 32835

407.291.9000 | www.realpropertyspecialists.com

s E A n M . s n A I T h , P h . D .

Sean Snaith, Ph.D., is the Director of the Institute for Economic Competitiveness within the College of Business Administration at the University of Central Florida and is a widely recognized economist in the field of business and economic forecasting.

As an award-winning forecaster, researcher, and professor, Snaith is always interested in the application of academic expertise to the solution of real world problems. Snaith has served as a consultant for a client list ranging from local and regional municipalities to multi-national corporations, including Compaq, Dell and IBM. He has held teaching positions at Pennsylvania State University, American University in Cairo, University of North Dakota and University of the Pacific.

Snaith frequently appears in national and regional media and is sought after as a speaker. He has been quoted in the Wall Street Journal, USA Today, the New York Times, and the Chicago Tribune and has appeared on CNBC and Fox Business Channel. Known for his engaging presentations, one business editor wrote, “Snaith (has) an uncanny knack of making economics not only understandable but interesting.”

Snaith is a member of several economic organizations and national economic forecasting panels including USA Today’s Survey of Top Economists, Federal Reserve Bank of Philadelphia’s Survey of Professional Forecasters, Bloomberg, Reuters and the Livingston Survey.

In 2007 he was named California’s most accurate forecaster by the Western Blue Chip Consensus Forecast, besting UCLA, Wells Fargo and other esteemed forecasting groups. Snaith holds a B.S. in Economics from Allegheny College and an M.A. and Ph.D. in Economics from Pennsylvania State University.

Snaith was recently named by Bloomberg News as one of the nation’s most accurate forecasters and was one of just two academic economists making the list which was released in the December 2008 issue of Bloomberg Markets.

FoR MoRE INFoRMATIoNSean Snaith, DirectorInstitute for Economic CompetitivenessCollege of Business AdministrationUniversity of Central FloridaP.o. Box 161400orlando, FL 32816

PH: 407.823.1451FAX: 407.823.1454E-MAIL: [email protected] www.iec.ucf.edu

Director, Institute

for Economic

Competitiveness.

Ph.D., Pennsylvania

state University 1996;

M.A., Pennsylvania state

University 1994; B.s.,

Allegheny College 1989.

We would like to recognize the following organizations for their support of the Institute for Economic

Competitiveness:

U n I v E r s I T y o F C E n T r A L F L o r I D AC o l l e g e o f B u s i n e s s A d m i n i s t r a t i o n


P. o . B o x 1 6 1 4 0 0 , o r l a n d o , F l o r i d a 3 2 8 1 6

P h 4 0 7. 8 2 3 . 1 4 5 3 FA X 4 0 7. 8 2 3 . 1 4 5 4 w w w . i e c . u c f . e d u

U.S. Forecast May 2010

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