A number of forecasts show the economy should continue it’s momentum from the end of 2009 into the new year. A number of countries are also expected to show improvement, as the world recovers from the worst global recession in decades.
Rising consumer sentiments should see demand climb as spending levels recover somewhat. The Fed has maintained it’s stance on keeping interest rates near zero for an extended period of time which should also help the financial system to stabilize further.
However, the labor situation is still a major cause for concern even though unemployment flattened out last month, the upcoming jobs report on Friday could be a major indicator on far recovery efforts have really come. There are a number skeptics on whether unemployment has yet to bottom out, only a few months ago there were quite a few predictions that the unemployment rate could rise as high as 13% before job creation began again.
While it doesn’t look like it will be that bad, many economist believe that the unemployment rate could remain in the double digits for some time and that could limit how much consumer spending levels recover. It doesn’t look to be a smooth recovery and there could be a few hiccups along the way.
Source: www.banks.com.
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