US budget deficit is the top priority concern for economists

According to the latest survey of the NABE economists the immense U.S. budget deficit is the gravest threat facing the economy, topping high unemployment and the risk of inflation or deflation.

47 member panel of forecasters of the National Association for Business Economics increased the estimate for the 2011 federal deficit to $1.4 trillion from $1.1 trillion in its previous survey in November.

Meantime, the forecast made by the panel is lower than that of the Obama administration projection of a record $1.65 trillion this fiscal year, or 10.9 percent of U.S. gross domestic product.

Besides, the panel also changed its view of the Federal Reserve's decision to pump more money into the economy by buying government bonds. Now most of the forecasters believe that the Fed's decision to buy an additional $600 billion in longer-term Treasury securities has diminished the risk of deflation or had no impact on inflation.

November's survey showed economists worried that the bond purchases could stoke inflation.

Panelists forecast core inflation, which excludes volatile food and energy prices, to rise gradually from 0.8 percent in the final quarter of last year to 1.2 percent in 2011.

GDP growth for 2011 is expected to advance 3.3 percent year over year, up from the panel's previous estimate of 2.6 percent, the survey said.