Review of the quarter's economic trends [October 1977]

The present position and outlook might be depicted as follows. The recovery can be considered to be reasonably well established in the US, which alone in the developed world has seen a strong revival in business fixed investment. It is also the only major economy where unemployment, currently averaging 7% of the civilian labour force, seems unlikely to rise further in the next year. Real GDP growth is likely to be of the order of 5% annually during both 1977 and 1978. The current account of the balance of payments seems set to remain in substantial deficit up to the middle of next year. As this brief analysis will show this in part reflects substantial oil imports, and so its effects on the trade balance of the developed world may not be large