The March Wall Street Journal Economic Forecast Survey was published on March 18, 2013. The headline is “Easy Money Era a Long Game for Fed.”
Although I don’t agree with various aspects of the survey’s contents, I found numerous items to be notable, both within the article and in the Q&A found in the spreadsheet.
Notable excerpts from the article include:
According to the economists surveyed, circle these dates on your calendar: November 2013, May 2014 and June 2015. That is when on average they expect the Fed, respectively, to:
1) start slowing its monthly bond purchases,
2) stop buying bonds, and
3) begin thinking seriously about raising short-term interest rates, as unemployment reaches 6.5%.
also:
Economists surveyed by the Journal, on average, said they didn’t expect the Fed’s balance sheet to return to normal—not bloated with the many extra bonds purchased in its quantitative-easing programs—until December 2019. More than a decade after the financial crisis ended, in other words, the Fed might still be a big player in long-term bond markets, directly shaping long-term rates.
also:
They also said markets weren’t overheating, despite a recent run of stock-market highs; on a scale of 0 to 10, they said froth in markets was about a 5.
As well, as to the question (seen in the spreadsheet detail) “Please estimate on a scale of 0 to 100 the probability of a recession in the U.S. in the next 12 months,” the average was 15%.
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The current average forecasts among economists polled include the following:
GDP:
full-year 2013: 2.3%
full-year 2014: 2.9%
full-year 2015: 3.0%
Unemployment Rate:
December 2013: 7.4%
December 2014: 6.8%
December 2015: 6.2%
10-Year Treasury Yield:
December 2013: 2.41%
December 2014: 3.04%
December 2015: 3.61%
CPI:
December 2013: 2.1%
December 2014: 2.2%
December 2015: 2.4%
Crude Oil ($ per bbl):
for 12/31/2013: $94.94
for 12/31/2014: $93.10
(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” category)
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I post various economic forecasts because I believe they should be carefully monitored. However, as those familiar with this blog are aware, I do not necessarily agree with many of the consensus estimates and much of the commentary in these forecast surveys.
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The Special Note summarizes my overall thoughts about our economic situation
SPX at 1552.10 as this post is written