Gross domestic product increased at a 5.4% annual rate in 2000:IQ, according to the advance estimate released in late April. This is higher than the 3.7% average growth rate of the current expansion, which began in 1991:IIQ; the 4.5% average growth rate of the past four years; and the 4.7% early-April Blue Chip forecast. The forecast for the remainder of 2000 shows growth returning to its 30-year average value. This prediction can be taken with a grain of salt, however, for the actual advance estimate has exceeded the forecast in all but five of the past 21 quarters, by an average of 1.2 percentage points (30%). For several years, forecasters seemed skeptical that this burst of high productivity growth would continue, but rising growth-rate forecasts have brought the average error down from –1.3 to –0.8 percentage points.
Suggested citation: "Economic Activity," Federal Reserve Bank of Cleveland, Economic Trends, no. 00-05, pp. 09-10, 05.01.2000.