Continued job growth, sustainable gains in home equity and baby boomers' spending habits are among elements that suggest consumer spending will grow 3 percent to 3.5 percent next year, said Carl Steidtmann, chief economist for Deloitte Research, a unit of Deloitte Touche Tohmatsu.
"We see the broad economy losing a little steam, but we're losing steam from a pretty high level," Steidtmann said.
Highlighting the importance of consumer spending, the economist said the 2001 recession was mild largely because it was the first recession since World War II in which consumer spending didn't drop on an annual basis.
Aggressive tax cuts, low interest rates, mortgage refinancing and home equity all played a role, Steidtmann said.
"One of the greatest things about the American consumers is that if you give them cash ... they go out and spend it," he said.
Copyright 2004 by United Press International
