Leading Silicon Valley Economist Predicts Slow Economic Growth In 2013

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Silicon Valley Location Of IBM In San Jose. (David Mcnew/Getty Images)

Silicon Valley Location of IBM in San Jose. (David Mcnew/Getty Images)

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SANTA CLARA (KCBS) – One of Silicon Valley’s leading economists is predicting that the economy will continue to grow at a slow, but steady pace in 2013.

Santa Clara University Economic Professor Mario Belotti’s annual economic forecast calls for a 2.5 percent growth this year or to use a weather analogy:

“I think it’s still partly cloudy. It’s not quite sunny yet,” he said.

Belotti said the economy faced three major obstacles in 2012: the crisis in Europe, a slowdown in China and the fiscal cliff. But he said the U.S. has weathered all three, for the most part.

Sequestration is still a concern for 2013 but Belotti said one bright spot is the housing sector, which has a multiplier effect on the economy.

“Everyone that buys another house, a new home or existing home, after they buy the place, they spend another $10,000 to $20,000 to change some of the things they don’t like,” he said.

Belotti predicts inflation will remain low this year, along with long-term interest rates.

(Copyright 2013 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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