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To: Ahda who wrote (22802)	11/10/1998 12:58:00 PM
From: cool	Respond to of 116759

SAN DIEGO--(BUSINESS WIRE)--Nov. 10, 1998--The U.S. economy should continue to grow in 1999, with inflation remaining in check and interest rates possibly dropping further, according to an economic forecast issued Tuesday by Dr. Michael R. Darby, consulting economist to City National Bank. Darby, a UCLA professor and former undersecretary at the U.S. Department of Commerce, issued his forecast during the 1999 San Diego Economic Outlook Conference, sponsored by the San Diego Chamber of Commerce. "We probably have seen the end of this incredible growth and will likely move into a period of moderate growth. There are many indicators that point to a growth rate of about 2.7 percent next year," Darby told approximately 250 conference attendees. "For instance, unemployment rates should remain at their historic lows of 4.5 percent and consumer and investment spending should continue to increase. Also, our current estimates are consistent with a 7 to 10 percent rise in the stock market." For now, Darby said, the City National Bank forecast counters fears that the United States could enter a recession next year. "There has been widespread concern about a recession due to economic woes in Asia and elsewhere. The question has been whether the United States can remain insulated from the overseas turbulence," Darby said. "However, a better-than-expected growth rate this year is expected to carry over to 1999. Plus, I think we have seen the worst of it from Asia and other foreign economies with similar problems." Darby is a distinguished economist whose research is used extensively by City National Bank's investment and trust division. "As a leading investment institution, City National Investments is encouraged by the economic forecasts we heard today. While the national and local economies both will remain strong, we should expect to see more moderate advancements in the stock market," said Vernon Kozlen, executive vice president of City National Investments. "Certainly, there are areas of the total economic picture that require close monitoring and constant research. But, given that there are many positive indicators, we remain optimistic for long-term growth for our investors. We are living in one of the most resilient economic periods of the century." Other highlights of the forecast report issued Tuesday include: T -- Unemployment rates in 1999 should remain at their historic lows of 4.6 percent. -- The inflation rate -- or Consumer Price Index -- should rise from a 1.6 percent rate estimated for this year to 2.7 percent in 1999. -- The average yield for three-month Treasury bills should remain about 5.0 percent in 1999, while the 30-year rate should also remain at its current 5.6 percent level. T Darby said he expects the Federal Reserve to continue decreasing interest rates by another one-quarter to one-half of a percent in early 1999, but could tighten the money supply if inflation inches close to 3 percent. Regarding the Year 2000 "millennium bug" issue for many computer systems, Darby said the U.S. economy should be positively impacted in 1999 as companies and individuals continue to buy equipment, employ more technicians and prepare for the expected computer glitch. Negative impacts on the economy from the Year 2000 problem likely won't occur until the turn of the century. The premier business and private bank for Southern California, City National Bank is a federally chartered, $5.5 billion commercial bank. City National now has 37 banking offices throughout Los Angeles, Orange, San Diego, Riverside and Ventura counties. City National Corp. is a publicly owned corporation whose stock is traded on the New York Stock Exchange under the symbol CYN. For more information about City National, the company's Fax-On-Demand Information Service is at 800/873-5293, and City National's Web page is at cityntl.com. --30--MT/la* DB/la CONTACT: City National Investments Vernon Kozlen, 310/888-6306 or City National Bank Jim Dunnigan, 310/888-6636 or Stoorza, Ziegaus & Metzger Denis Wolcott, 213/891-2822 KEYWORD: CALIFORNIA INDUSTRY KEYWORD: BANKING TRADESHOW COMPUTERS/ELECTRONICS COMED Today's News On The Net - Business Wire's full file on the Internet