To break the record for economic expansion, the economy must continue to expand until early in the year 2000. Forecasts for slower growth point to the manufacturing sector, which has been hurt by declining export demand and falling commodity prices. The decline in exports has widened the U.S. trade gap. Increased consumer spending has countered this drag on the economy. Strong job and income growth and the positive wealth effect from the stock market were responsible for increased consumer spending.
All forecasts have question marks.
The biggest question mark in the 1999 forecasts is the impact of reduced world economic growth on the U.S. economy. The Asian economies are still in recession and Brazil, Argentina and Chile could possibly be headed for economic downturns. If a number of Latin American countries were also to have a recession, this might have a significant impact on the U.S. economy.