Washington is bracing for a slowdown after July-August revenues came in 1.3% lower than June’s forecast, the Economic and Revenue Forecast Council said.
The lower collections came after a June forecast that assumed the state and national economies would experience a slowdown through June after moderate growth in the spring.
“In recent weeks it has become clear that the increase in the economic activity which was expected to be underway by now has not occurred,” the council said.
The council said the state and nation face uncertainties from the European debt crisis, the congressional wrangling over the debt ceiling and Standard & Poor’s downgrade of United States debt.
It said the resulting decline in consumer confidence is likely to slow growth in the state in the second half and increase the risk of another downturn.
In May, state lawmakers passed a budget that closed an almost $5 billion hole for the current two fiscal years.