Business brass are taking a dim view of the economic recovery, keeping optimistic statements to a minimum and making few growth moves—such as rehiring, capital investments, and so forth. However, economists tend to dismiss this C-level gloom and doom as so much fallout from last year's inventory debacles and the Enron financial scandal. Professional forecasters, in, fact, continue to boost their growth predictions for 2002, raising the GDP forecast consensus by more than half a point between March and April, according toBlue Chip Economic Indicators.

Motor vehicle manufacturing is crawling back from its 11% decline in 2001. Automakers boosted production 4% in first quarter 2002 because of higher-than-expected sales and have raised second-quarter production schedules by another 4%.

Turn to page 26 to find out who won PURCHASING's 2001 Crystal Ball Economic Forecasting contest. To enter the 2002 competition, go to www.purchasing.com. Deadline for entering is midnight on June 30, 2002. Prizes: $500 for first place, $150 for second, $100 for third. Previous winners can enter, but can claim no prize money. If there's a tie in the scoring, earlier time stamp wins. PURCHASING's Web location also features links to data sources necessary for formulating forecasts.

Oil prices are rising. And while economists have been quick to say this won't derail the economic recovery completely, they're taking it more seriously than other recent oil price spikes due to the considerable escalation of Mideast tensions, which raises the likelihood of desperate political moves. Following its high oil price scenario (a spike to $30-$33/bbl by fall), DRI-WEFA says impact to GDP growth would be negative 0.2-0.3 percentage points and impact to consumer inflation would be positive 0.5-0.7 percentage points with similar impacts in both Europe and Asia.

Northeast region is showing the most dramatic economic rally, according to Business Survey data from PURCHASING Magazine. The Northeast Business Activity Index, which reflects buyers' reports of new order activity at their companies, has moved steadily up from a low of just 15 last November to a strongly positive 68 in April 2002. West and Midwest regions are showing similarly dramatic turnarounds while the Middle Atlantic and Southern states are coming along, albeit more slowly.