The U.S. economy experienced a soft patch during the April-June quarter of 2013 due to the effects of fiscal austerity measures. From the July-September quarter, as the effects dissipate to some extent, the U.S. economy is likely to exhibit relatively high growth on the back of firm consumer sentiment and a pick-up in the housing market (Charts 20 and 21).
The fact that the debt ceiling problem has been delayed until autumn 2013 at the earliest due to higher-than-expected federal government revenues is judged to be one of the factors reducing the immediate tail risk. The European economy still lags behind, but the situation does not call for a further downward revision to the economic outlook.