Chicago Fed Symposium Sees Economy Improving

The U.S. economy will improve this year and remain at that level in 2011 as inflation ticks up and employment trends down, according to participants in the Federal Reserve Bank of Chicago automotive outlook symposium.

The consensus forecast sees real gross domestic product expanding 3.1% this year and predicts a similar increase for next year. Inflation, as measured by the consumer price index, is seen rising 0.2 percentage points annually, to 1.7% this year and 1.9% in 2011.

The jobless rate, which averaged 10% in the final quarter of 2009, is seen dipping to 9.5% by year end and 8.8% by the end of 2011.

“Interest rates (one- and 10-year Treasury rates) are anticipated to rise this year and next year,” the Chicago Fed said in a statement.

“Oil prices are expected to average $82 per barrel by the end of 2010 and then rise to just under $88 per barrel by the end of 2011,” it said.

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