Great recession ended

The largest since the Great Depression, the recession ended, but the relatively small cost to consumers in terms of substantial unemployment slow down the economic recovery, according to a study released on Monday. Report of 44 professional researchers of the National Association of Business Economists (NABE) showed that 80 percent of respondents believe that the economy will resume growth after chetyrehkvartalnogo reduction. "Great recession is over," said Association President Lynn Riiser. "The vast majority of business economists believed that the recession is over, but that economic recovery is likely to be more moderate than there were before." The current recession, which began in December 2007 is the longest and deepest in the 1930's. It was caused by the collapse of U.S. real estate market and the global credit crunch. A survey conducted in September, predicts real GDP growth by 2.9 per cent in the second half of this year. Production in 2009 is expected to decline by 2.5 percent and next year will be restored to 2.6 per cent. Most of the expected recovery will be realized by companies that are restructuring their assets after the rapid reduction of unwanted stocks of unsold goods in the conditions of weak demand. Investments in the housing market is also growing, with most experts believe that more than three years of falling real estate market is coming to an end. Real estate prices have reached bottom Approximately two-thirds of respondents believe that property prices reached bottom this year. Also in the survey said that the high real estate prices will not jeopardize the restoration sector. The study predicts that unemployment will increase by 10 percent in the first quarter and decreased by 9.5 percent by the end of 2010. The labor market is expected to return the destroyed crisis workers only to 2012 or later. Weak labor market will continue to affect consumer spending, slowing the recovery. The unemployment rate rose by 9.8 percent in September - 26-year high - from 9.7 percent in August. Weak labor market, together with the weak growth of wages, means that inflation will not impede economic recovery, and that the Fed will not under pressure to increase interest rates. "With an improving credit markets, the U.S. economy can return to the thorough growth in the next year without worrying about rising inflation," said Riiser. The U.S. central bank is likely to keep interest rates near zero until the end of next spring, but may increase it to 1 percent by the end of 2010, reported in the study. Despite signs of recovery in financial markets, the majority of respondents believed that to return to their former positions of the world economy needs a lot of time. Only 29 percent believe that it will happen in the second half of next year. Respondents also expect the U.S. dollar will continue falling in the next two years, but did not believe that this will help reduce the trade deficit of the country, as economic recovery encourages imports. The dollar has lost about 5.8 percent of its value against a basket of currencies this year, largely because of concern about the growing budget deficit and the growth of government expectations that the Federal Government to hold on interest rates at very low levels for a long time.