
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, March 27, 1991                   TAG: 9103270487
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A/1   EDITION: EVENING 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

MILDER RECESSION LIKELY

The U.S. economy fell at an annual rate of 1.6 percent in the final three months of last year, a less-severe downturn than previously believed, the government said today.

The Commerce Department's revised estimate of the gross national product - the The will to buy is back, but the wallet's weak. C5 broadest measure of economic health - served to bolster the Bush administration's view that the current recession will be shorter and more shallow than the average downturn.

The department's estimate that the economy shrank at a 1.6 percent rate in the October-December quarter represented an upward revision from two earlier GNP reports.

The unexpected strength came in the country's trade performance, which added $37.7 billion to economic activity in the fourth quarter as exports expanded at a much faster clip than previously believed while imports fell.

Originally, the government put the size of the drop in economic activity at 2.1 percent and then last month that figure was revised slightly to show GNP declining by 2 percent.

Analysts said the upward revision did not change their view that economic activity will be down again in the first quarter.

Many analysts are looking for GNP to drop at a 2 percent rate in the January-March quarter, thus meeting the classic definition of a recession as two consecutive quarterly declines in GNP.

But the unexpected pockets of strength in the fourth quarter did support the view of many economists that the current recession, the country's first in eight years, will probably end in the April-June quarter without inflicting as severe a loss of output or jobs as is typical.

Treasury Secretary Nicholas Brady said today that the country was beginning to see the "first tangible signs of a turnaround."

by CNB