Economists understating US GDP

The strength of the U.S. economy is being underestimated and will grow more than expected in the second quarter, according to First Trust Advisors chief economist Brian Wesbury.

The Atlanta Federal Reserve’s GDPNow forecasting model showed in May the U.S. economy is expanding at a 4.7% annualized rate in the second quarter, but Wesbury expects close to 5% growth.

“In June we had 20 companies report their earnings: Oracle, FedEx, Adobe – they were all in this and 19 out of 20 of those companies beat their estimates,” he told FOX Business’ Stuart Varney on “Varney & Co.” on Monday. “So that’s what I’m expecting … for the second quarter.”

Wesbury also expects companies to report strong earnings in the 20% to 25% range.

“We are in boom time right here,” he said, adding that “it’s the best economy since 2004 after the Bush tax cuts.”