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Economists estimated greater contraction in real gross domestic product, increases in the jobless rate and more job losses, according to the first quarter 2009 Survey of Professional forecasters released today by the Federal Reserve Bank of Philadelphia. However, they expect real GDP will grow again in the third quarter, according to the report.
The forecasters predicted real GDP will contract 5.2% in the first quarter, according to the latest survey. They had estimated a contraction of only 1.1% in the previous survey.
Second-quarter real GDP is estimated to contract 1.8%, according to the most-recent survey. It's expected to grow again, by 1.0%, in the third quarter.
The forecasters expect unemployment to hit 7.8% in the first quarter, rising to 9.0% in the first quarter of 2010. In the previous report, they estimated the jobless rate would hit only 7.0% in the first quarter.
Economists also estimated job losses of 548,400 per month in the first quarter, compared with their previous estimate of 218,800 losses. They don't expect the economy to add jobs again until the first quarter of 2010 when they estimate 38,700 new jobs.