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Clinton budget forecasts slower USgrowth in 2001

WASHINGTON: President Bill Clinton's proposed budget for fiscal year 2001 forecasts U.S. economic growth of about 2.6 percent in 2001, down from 4.0 percent in 1999, White House officials said.

Growth would moderate further to 2.5 percent for the following couple of years, Joe Minarik, associate director of economic policy at the budget office, told reporters.

Economic growth would then revive to about 3.0 percent per year until baby boomers begin to retire later this decade and the growth rate slows, Minarik said.

He projected a consumer price inflation rate of 2.5 percent in 2001, edging up to 2.6 percent afterward.

The Consumer Price Index, the nation's main gauge of price pressures at the consumer level, was up 2.7 percent overall in 1999, boosted by higher oil prices and energy costs. That was the biggest rise since 1996.

Clinton's 2001 budget projects the unemployment rate will grow from a 30-year low of 4.0 percent in January to 4.5 percent in 2001, five percent in 2002 and 5.2 percent after that.

Sylvia Mathews, deputy director of the White House Office of Management and Budget, said the budget is based on economic assumptions that are "slightly more conservative" than the consensus of top economists.-Reuters