Maintenance of such a pace would put even greater pressures on the economy’s resources, threatening the balance and longevity of the expansion. However, it appeared likely that the difficulties being encountered by Asian economies, by cutting into US exports, would be a potentially important factor slowing the growth of aggregate demand in the United States.
But uncertainties about the timing and dimensions of that development were considerable given the difficulties in assessing the extent of the problems in East Asia. In the event, the contraction of output and incomes in a number of Asian economies has turned out to be more substantial than most had anticipated.