The Securities Industry and Financial Markets Association’s Economic Advisory Roundtable has lowered its forecast for U.S. economic growth.

In its latest forecast, the SIFMA roundtable predicts that the economy will grow at 2.8% in 2010 and 2.6% in 2011. This outlook is weaker than at mid-year, when it predicted growth of 3.3% and 3.1% in 2010 and 2011, respectively.

“While there was some belief that a rebound in job growth and consumer and business confidence could jumpstart a stronger growth pace, concerns over fiscal policy, continued weakness in housing and mortgage markets, European sovereign debt concerns, regulatory uncertainties, and fiscal problems are significant risks to the downside,” it said.

The future course of inflation remains a highly debated topic, but 85% of respondents did not believe it to be a concern in 2011, it said. The respondents were also unconcerned with the US Federal Reserve Board continuing to expand its balance sheet, it noted.

They also differ as to when the U.S. federal deficit should be addressed. “Growth could be at risk if too many changes to fiscal policy were made while the economy was still weak. However, if a plan for reduction is not soon addressed the structural imbalances would cause harm to a medium or long-term economy,” it said.

Finally, the members of the roundtable had a wide range in opinions concerning regulatory reform, although there was consensus was that it will contribute to slower consumer credit growth, which could have a small negative effect for overall growth. However, they also viewed reform as leading to ‘stronger financial institutions’ and ‘more stability’ in the long-term.

Large room for interpretation is a major concern regarding the reform, it noted, adding that regulatory uncertainty overall was believed to have had a negative impact on the U.S. economic growth over the last six months.

IE