Housing Slump Expected to Weigh on Economy

Housing Slump Expected to Weigh on Economy

The slowdown that hit the U.S. economy will persist into 2007 as the once red-hot housing market continues to suffer through a serious correction, analysts say.

As the new year begins, many private analysts are forecasting the economy will perform at the slowest pace in five years, a full percentage-point lower than growth in 2006.

One such analyst is Nariman Behravesh, chief economist at Global Insight, a forecasting firm. "The recession in the housing market does not seem to have had much of an impact on the consumer," he said. "The bad news on housing has been offset by good news on wages, jobs and the stock market."

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