CBO Forecasts Moderate GDP Growth

In preparing the budget for next year, the Congressional Budget Office (CBO) releases its forecast for economic growth for the next decade. This forecast is used to set the budget limits, since most experts agree the budget should be no more than 20% of GDP.

The CBO forecasts GDP growth to be 2.3% in 2007, 3% in 2008, and 2.9% each year after that until 2012. (Source: CBO, "The Budget and Economic Outlook: Fiscal Years 2008-2017", January 2007)

Like many other economists, the CBO is forecasting a "soft landing" for the economy, which assumes that the housing decline won't throw the economy into recession, and that high gas prices won't return, aggravating inflation.

Find out more about how GDP affects the U.S. economy...