The economy will look pretty grim through the end of the year, says Ward McCarthy, chief financial economist at Jeffries.
Consumer confidence is down and unemployment rates remain high, McCarthy tells Yahoo’s The Daily Ticker.
The Labor Department will unveil its unemployment figures on Friday, and while July figures were a welcome surprise at a net 117,000 nonfarm payrolls added to the economy, August figures should disappoint.
McCarthy, known for his optimism, says he expects to see 30,000 nonfarm payrolls added to the economy, down from a consensus of 100,000 jobs.
A strike involving 45,000 Verizon workers will put a dent in the numbers.
On top of that, McCarthy says he expects the economy to grow 1.8 percent in the third quarter of this year and 2.5 percent in the fourth quarter, down from earlier forecasts.
"I think it is going to stay very disappointing for a long period of time and I mean at least through 2012," McCarthy says.
Other institutions have been cutting growth forecasts as well.
Goldman Sachs has said it cut its U.S. growth estimates for the second half of 2011 to between 1 percent and 1.5 percent, as it sees the economy "losing further momentum," Reuters reports
"In light of the downshift in the data this week, we are cutting our second-half growth forecasts further," Goldman says in a research note, according to Reuters.
It was the firm's third cut in GDP estimates in August.
Goldman expects gross domestic product to grow 1 percent in the third quarter and 1.5 percent in the fourth, but down from 2.0 percent previously.
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