The economic data are taking on a new urgency. Recently, a few of the economy's vital signs have been erratic. Most notably, a popular measure of service-sector activity plunged to an all-time low, and payrolls last month posted the first monthly decline in nearly 4½ years. The trouble is, that's what the data often do when the economy is sinking into recession: They surprise, sometimes shockingly, on the downside. Most reports in the coming weeks will almost certainly look glum. But just how glum?
Economists' expectations have dropped sharply in only the past four weeks. The 51 forecasters surveyed by Blue Chip Economic Indicators now expect first-half growth to average only 0.8%, down from their 1.6% projection in January, and the number of outright recession forecasts is growing.