WASHINGTON, July 2: The US economy appears to be gaining momentum and with it the risk of higher inflation, a survey of economists by the Wall Street Journal showed on Monday.

The 60 economists on average expected growth in the second half of the year at a 2.6 per cent pace and a rise to 2.9pc in 2008. That would represent a decline from the 3.3pc rate of 2006 but an improvement from the sluggish 0.7pc pace the first quarter.

The economists put the probability of recession at 23pc, down from 27pc six months ago, the Journal said. Still, 30pc said a weak housing market remains the biggest risk to the economy.

At the same time, most of the forecasts said inflation is becoming a bigger risk -- in line with the outlook from the US Federal Reserve, which said it remains its predominant policy concern. As a result, few see a cut in interest rates by the Fed this year.—AFP