US growth to deteriorate further in 2007

11/13/06 - First Berlin

NEW YORK, November 13 (newratings.com) – Analysts at First Berlin expect a further slowdown in growth in the US during the forthcoming year, resulting in a reduction in the interest rates by 1Q07.

In a research note published this morning, the analysts mention that the recently reported decline in the US goods & services deficit to $64.3 billion in September is unlikely to have a significant impact on the markets, in view of the continuing high deficit trends. The analysts expect households to opt for savings rather than spend in 2007 on account of declining house prices and a weaker labour market. First Berlin believes that the Michigan Consumer Sentiment Index is expected to continue to weaken next year.