Economists lower second-half US growth forecasts

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April 8: Rising energy prices and higher interest rates will take a larger bite out of consumer spending and cause the US economy to slow later this year, a Bloomberg News survey of economists found.

The economy is projected to expand at an average 3.5% annual pace from July through December after growing an estimated 3.9% in the first six months, according to the survey conducted on 62 economists by Bloomberg News from April 1 to April 7.

‘‘It’s more a return to moderation than an outright collapse,’’ said Gina Martin, an economist at Wachovia Corp. in Charlotte, North Carolina. Record gasoline prices will siphon cash from consumers’ pockets that could otherwise be spent on other goods and services, economists said.

Higher fuel costs are stoking inflation and will prompt Federal Reserve policy makers to raise their interest-rate target more than previously thought, the survey also showed. Central bankers will raise the target for the benchmark overnight bank lending rate, currently at 2.75%, to 3.75% by the end of the third quarter and it will finish the year at 4%, according to the survey.

The Fed’s rate increases are expected to lead to higher rates on mortgages and other consumer loans. The increased costs will further restrain refinancing and keep homeowners from tapping into home equity to boost spending.

Refinancing helped sustain consumer purchases as the economy was recovering from the last recession. ‘‘Housing, which is the most interest-sensitive part of the economy and has been incredibly strong, should eventually start cooling,’’ said James O’Sullivan, a senior economist at UBS Securities LLC in New York. ‘‘The risks to inflation seem all aligned on the upside,’’ said Joseph Abate, a senior economist at Lehman Brothers Inc in New York. ‘‘This upcreep in inflation makes the Fed increasingly intolerant of above-trend economic growth.’’