The U.S. economy is expected to expand at a 3 percent rate in the fourth quarter based on steady U.S. manufacturing output growth, according to White House Council of Economic Advisors Chairman Kevin Hassett.
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“We’ve been getting stronger numbers in the U.S., despite the government shutdown,” he told FOX Business’ Maria Baritromo. “I’m looking at a third quarter very close to three [percent], which gives us a year of about three.”
Last week, the Federal Reserve said manufacturing surged in December, pushing industrial production up 1.1 percent.
“There’s a lot of momentum going forward for the U.S., especially if we can get this government shutdown worked out,” Hassett said on “Mornings with Maria.”
The partial government shutdown is going into its fifth week as the Trump administration and the Democrat-led House battle over border security funding.
“The president made a fair and reasonable offer to move forward and I think the next thing we’ll see is an attempt to get that through to the Senate,” he said. “I think that will be the next hurdle.”
Hassett said the White House is aware of the impact the government shutdown has on the economy, as consumer sentiment fell last week to its lowest level since President Trump was elected.
“We are very cognizant at CEA (Council of Economic Advisers) that as this thing drags, that there are down risks to the economy,” he said.
When asked if the U.S. economy is expected to fall into a recession in 2020, Hassett said, “Right now we don’t see that in sight. We’re looking for 3 percent growth this year as well because of all the momentum.”
"Last year everyone said our 3 percent forecast was crazy. It looks like we’re going to be right in a tenth or two. I think that the model that gave us 3 percent last year is saying we’ll get 3 percent this year too, so we’re sticking with our forecast," he added.