Tag Archives: Economic Forecasts

Philadelphia Fed – 1st Quarter 2017 Survey Of Professional Forecasters

The Philadelphia Fed 1st Quarter 2017 Survey of Professional Forecasters was released on February 10, 2017.  This survey is somewhat unique in various regards, such as it incorporates a longer time frame for various measures.

The survey shows, among many measures, the following median expectations:

Real GDP: (annual average level)

full-year 2017:  2.3%

full-year 2018:  2.4%

full-year 2019:  2.6%

full-year 2020:  2.1%

Unemployment Rate: (annual average level)

for 2017: 4.6%

for 2018: 4.5%

for 2019: 4.5%

for 2020: 4.6%

Regarding the risk of a negative quarter in real GDP in any of the next few quarters, mean estimates are 7.7%, 11.2%, 14.6%, 16.2% and 17.7% for each of the quarters from Q1 2017 through Q1 2018, respectively.

As well, there are also a variety of time frames shown (present quarter through the year 2026) with the median expected inflation (annualized) of each.  Inflation is measured in Headline and Core CPI and Headline and Core PCE.  Over all time frames expectations are shown to be in the 1.8% to 2.5% range.

_____

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 agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2317.66 as this post is written

The February 2017 Wall Street Journal Economic Forecast Survey

The February 2017 Wall Street Journal Economic Forecast Survey was published on February 9, 2017.  The headline is “Forecasters See Slow Progress in Labor-Market Measures Favored by Trump Administration.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the “Economist Q&A” section.

Two excerpts:

Mr. Mnuchin also mentioned the U-6 rate, which includes the discouraged workers mentioned above and people who have part-time jobs but want full-time work.

This is the Labor Department’s broadest measure of unemployment, which stood at 9.4% in January. Over the next three years it is expected to decline to 8.7%, according to the average forecast. If correct, that, too, would be higher than the rate seen in previous booms.

also:

The survey respondents expect labor-force participation to rise to 63.3% by the end of 2019. The overall population will also grow over this period, according to Census Bureau projections (which already assume that immigration will slow), and so the number of people outside the labor force would likely remain around 95 million.

As stated in the article, the survey’s respondents were 62 academic, financial and business economists.  Not every economist answered every question.  The survey occurred on February 3, 2017 to February 7, 2017.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 15.09%. The individual estimates, of those who responded, ranged from 0% to 33%.  For reference, the average response in January’s survey was 16.49%.

The current average forecasts among economists polled include the following:

GDP:

full-year 2016:  1.9%

full-year 2017:  2.4%

full-year 2018:  2.5%

full-year 2019:  2.1%

Unemployment Rate:

December 2017: 4.5%

December 2018: 4.4%

December 2019: 4.5%

10-Year Treasury Yield:

December 2017: 2.86%

December 2018: 3.31%

CPI:

December 2017:  2.3%

December 2018:  2.4%

Crude Oil  ($ per bbl):

for 12/31/2017: $55.79

for 12/31/2018: $59.17

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” category)

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2308.81 as post is written

The January 2017 Wall Street Journal Economic Forecast Survey

The January 2017 Wall Street Journal Economic Forecast Survey was published on January 12, 2017.  The headline is “Forecasters See Upside Risks to Their Economic Outlooks at Highest in More Than Two Years.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the “Economist Q&A” section.

Two excerpts:

In the most recent survey, 64% of respondents said the risk was to the upside, the highest in over two years, and a reversal from the mood of recent years, which was focused on potential risks from a global economic slowdown.

also:

In anticipation of Mr. Trump’s presidency, economic forecasts have already risen. The average forecast is for GDP growth of 2.4% in 2017 and 2.5% in 2018. That is a 0.2 percentage point increase for 2017 and 0.5 percentage point for 2018.

As stated in the article, the survey’s respondents were 67 academic, financial and business economists.  Not every economist answered every question.  The survey occurred on January 6, 2017 to January 10, 2017.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 16.49%. The individual estimates, of those who responded, ranged from 0% to 75%.  For reference, the average response in December’s survey was 16.79%.

The current average forecasts among economists polled include the following:

GDP:

full-year 2016:  2.0%

full-year 2017:  2.4%

full-year 2018:  2.5%

full-year 2019:  2.2%

Unemployment Rate:

December 2017: 4.5%

December 2018: 4.4%

December 2019: 4.5%

10-Year Treasury Yield:

December 2017: 2.89%

December 2018: 3.36%

CPI:

December 2017:  2.3%

December 2018:  2.4%

Crude Oil  ($ per bbl):

for 12/31/2017: $56.31

for 12/31/2018: $59.28

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” category)

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2270.44 as post is written

CEO Confidence Surveys 4Q 2016 – Notable Excerpts

On January 5, 2017, The Conference Board released the 4th Quarter Measure Of CEO Confidence.   The overall measure of CEO Confidence was at 65, up from 50 in the third quarter. [note:  a reading of more than 50 points reflects more positive than negative responses]

Notable excerpts from this January 5 Press Release include:

CEOs’ assessment of current economic conditions was considerably more optimistic, with close to 60 percent saying conditions were better compared to six months ago, up from just 17 percent last quarter. Business leaders’ appraisal of current conditions in their own industries also improved significantly, with 46 percent stating conditions in their own industries have improved versus only 21 percent in the third quarter.

CEOs’ short-term outlook for the U.S. economy also improved markedly, with approximately 67 percent expecting better economic conditions over the next six months, up from 25 percent last quarter. The outlook for their own industries was also more favorable, with 58 percent of CEOs anticipating an improvement over the next six months, compared to about 23 percent in the third quarter.

The Business Roundtable last month also released its CEO Economic Outlook Survey for the 4th Quarter of 2016.   Notable excerpts from the December 6, 2016 release, titled “Business Leaders:  Plans for Hiring Rise, Expectations for Sales Increase“ (pdf):

In their first GDP estimate for 2017, CEOs projected 2 percent growth next year. While the outlook for hiring is positive, the overall results suggest continued economic growth, albeit at a slow pace.

The Business Roundtable CEO Economic Outlook Index — a composite of CEO projections for sales and plans for capital spending and hiring over the next six months — rose by 4.6 points, from 69.6 in the third quarter to 74.2 in the fourth quarter. The Index remains below its historical average of 79.6.

CEO expectations for sales over the next six months increased by 4.5 points, and expectations for hiring increased by a more robust 14.8 points over last quarter. However, CEO plans for capital expenditures fell by 5.4 points relative to last quarter.

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2268.06 as this post is written

December 2016 Duke/CFO Global Business Outlook Survey – Notable Excerpts

On December 7, 2016 the December Duke/CFO Global Business Outlook was released.  It contains a variety of statistics regarding how CFOs view business and economic conditions.

In this CFO survey, I found the following to be the most notable excerpts – although I don’t necessarily agree with them:

For the last five quarters, the Duke University/CFO Global Business Outlook Optimism Index has hovered around the long-term average of 60 (on a 100-point scale). This quarter, post-election, the index jumped to 66, the highest level in nearly a decade. The proportion of CFOs becoming more optimistic outweighs those becoming more pessimistic by 4 to 1. Historically, a jump in the optimism index has predicted strong employment growth and rising GDP over the next year.

also:

U.S. firms plan to increase their payrolls by 2 percent in 2017 and expect a median increase in capital spending of 2 percent. While modest, spending is up from last quarter’s prediction of no growth.

The corporate sector faces increased financial risk due to a recent increase in borrowing. U.S. manufacturing firms increased their borrowing as a percentage of assets by one-third over the past five years; and energy firms levered up by two-thirds. More than 60 percent of the firms in these industries say that this high debt load will limit future corporate investment.

“Weak business spending has dampened economic growth during the past two years,” Graham said. “Finance chiefs tell us that any rebound in business spending will be muted because of debt loads at many firms that are already high.”

The CFO survey contains two Optimism Index charts, with the bottom chart showing U.S. Optimism (with regard to the economy) at 66, as seen below:

Duke CFO Survey optimism

It should be interesting to see how well the CFOs predict business and economic conditions going forward.   I discussed past various aspects of this, and the importance of these predictions, in the July 9, 2010 post titled “The Business Environment”.

(past posts on CEO and CFO surveys can be found under the “CFO and CEO Confidence” tag)

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2247.93 as this post is written

The December 2016 Wall Street Journal Economic Forecast Survey

The December 2016 Wall Street Journal Economic Forecast Survey was published on December 8, 2016.  The headline is “Economists Doubt the U.S. Can Regain Many of the Factory Jobs Lost in Recent Decades.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the “Economist Q&A” section.

Two excerpts:

“Manufacturing employment is now back to 1941 levels and falling,” said James Smith, chief economist of Parsec Financial. “This is a global trend and not at all specific to the U.S. It is caused by labor productivity growth.”

also:

Yet many of the economists in the survey agree with Mr. Smith that the biggest reason so many fewer people work in today’s factories are advances in automation. Improvements in assembly-line technologies and the deployment of industrial robots allow U.S. manufacturers to produce more goods than ever before, but with much smaller workforces. Even if all outsourcing were ended immediately, the march of technology would put steady downward pressure on manufacturing employment.

Asked about the primary cause of the decline of manufacturing jobs, 47% of respondents pointed to automation while 18% said automation and offshoring had played roughly equal roles. About 28% said offshoring had been the primary culprit.

As stated in the article, the survey’s respondents were 62 academic, financial and business economists.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 16.79%. The individual estimates, of those who responded, ranged from 0% to 65%.  For reference, the average response in November’s survey was 18.54%.

The current average forecasts among economists polled include the following:

GDP:

full-year 2016:  1.9%

full-year 2017:  2.4%

full-year 2018:  2.4%

full-year 2019:  2.2%

Unemployment Rate:

December 2016: 4.7%

December 2017: 4.5%

December 2018: 4.4%

December 2019: 4.6%

10-Year Treasury Yield:

December 2016: 2.34%

December 2017: 2.79%

December 2018: 3.23%

CPI:

December 2016:  1.9%

December 2017:  2.4%

December 2018:  2.5%

Crude Oil  ($ per bbl):

for 12/31/2016: $50.66

for 12/31/2017: $55.58

for 12/31/2018: $57.19

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” category)

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2247.85 as post is written

The November 2016 Wall Street Journal Economic Forecast Survey

The November 2016 Wall Street Journal Economic Forecast Survey was published on November 13, 2016.  The headline is “GDP, Inflation And Interest Rates Forecast to Rise Under Trump Presidency.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the “Economist Q&A” section.

An excerpt:

On average, economists marked up their growth forecasts. The economy could expand 2.2% in 2017 and 2.3% in 2018, as a fiscal stimulus kicks into gear, up from about 1.5% over the past 12 months. Inflation is seen at 2.2% next year and 2.4% in 2018. If correct, it would be the first stretch of sustained inflation above 2% since before the recession of 2007 to 2009.

The forecasts were collected from 57 academic, business and financial economists from Nov. 9 to Nov. 11. Their average forecasts for growth, inflation and interest rates in both 2017 and 2018 all rose, at least slightly, from a survey conducted before the election in October.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 18.54%. The individual estimates, of those who responded, ranged from 0% to 60%.  For reference, the average response in October’s survey was 20.24%.

The current average forecasts among economists polled include the following:

GDP:

full-year 2016:  1.8%

full-year 2017:  2.2%

full-year 2018:  2.3%

Unemployment Rate:

December 2016: 4.9%

December 2017: 4.6%

December 2018: 4.6%

10-Year Treasury Yield:

December 2016: 2.05%

December 2017: 2.49%

December 2018: 3.00%

CPI:

December 2016:  1.8%

December 2017:  2.2%

December 2018:  2.4%

Crude Oil  ($ per bbl):

for 12/31/2016: $47.44

for 12/31/2017: $53.00

for 12/31/2018: $56.53

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” category)

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2165.53 as post is written

Philadelphia Fed – 4th Quarter 2016 Survey Of Professional Forecasters

The Philadelphia Fed 4th Quarter 2016 Survey of Professional Forecasters was released on November 14, 2016.  This survey is somewhat unique in various regards, such as it incorporates a longer time frame for various measures.

The survey shows, among many measures, the following median expectations:

Real GDP: (annual average level)

full-year 2016:  1.5%

full-year 2017:  2.2%

full-year 2018:  2.1%

full-year 2019:  2.1%

Unemployment Rate: (annual average level)

for 2016: 4.9%

for 2017: 4.7%

for 2018: 4.6%

for 2019: 4.7%

Regarding the risk of a negative quarter in real GDP in any of the next few quarters, mean estimates are 9.9%, 14.0%, 15.0%, 16.5% and 18.9% for each of the quarters from Q4 2016 through Q4 2017, respectively.

As well, there are also a variety of time frames shown (present quarter through the year 2025) with the median expected inflation (annualized) of each.  Inflation is measured in Headline and Core CPI and Headline and Core PCE.  Over all time frames expectations are shown to be in the 1.4% to 2.3% range.

_____

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 agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2162.96 as this post is written

The October 2016 Wall Street Journal Economic Forecast Survey

The October 2016 Wall Street Journal Economic Forecast Survey was published on October 13, 2016.  The headline is “Economists Believe a Recession Is Likely Within Next Four Years.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the “Economist Q&A” section.

Two excerpts:

The current expansion began in June 2009, and has now continued for 88 months, making it the fourth-longest period of growth in records stretching to 1854.

also:

The survey of 59 academic, business and financial economists was conducted from Oct. 7 to Oct. 11.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 20.24%. The individual estimates, of those who responded, ranged from 1% to 55%.  For reference, the average response in September’s survey was 20.25%.

The current average forecasts among economists polled include the following:

GDP:

full-year 2016:  1.8%

full-year 2017:  2.2%

full-year 2018:  2.0%

Unemployment Rate:

December 2016: 4.8%

December 2017: 4.7%

December 2018: 4.7%

10-Year Treasury Yield:

December 2016: 1.81%

December 2017: 2.30%

December 2018: 2.69%

CPI:

December 2016:  1.7%

December 2017:  2.2%

December 2018:  2.2%

Crude Oil  ($ per bbl):

for 12/31/2016: $49.74

for 12/31/2017: $54.03

for 12/31/2018: $56.24

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” category)

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2132.55 as post is written

CEO Confidence Surveys 3Q 2016 – Notable Excerpts

On October 4, 2016, The Conference Board released the 3rd Quarter Measure Of CEO Confidence.   The overall measure of CEO Confidence was at 50, down from 52 in the second quarter. [note:  a reading of more than 50 points reflects more positive than negative responses]

Notable excerpts from this October 4 Press Release include:

CEOs’ appraisal of current economic conditions was less optimistic, with 17 percent saying conditions are better compared to six months ago, down from 21 percent last quarter. Business leaders’ assessment of current conditions in their own industries also moderated, with 21 percent stating conditions in their own industries have improved versus 30 percent in the second quarter.

CEOs’ short-term outlook for the U.S. economy held steady, with 25 percent expecting better economic conditions over the next six months, about the same as last quarter. The outlook for their own industries, however, was less favorable, with about 23 percent of CEOs anticipating an improvement over the next six months, down from almost 33 percent in the second quarter.

The Business Roundtable last month also released its CEO Economic Outlook Survey for the 3rd Quarter of 2016.   Notable excerpts from the September 12, 2016 release, titled “CEO Economic Outlook Suggests Continued Concerns Over Flat Economy“ (pdf):

The Business Roundtable CEO Economic Outlook Index — a composite of CEO projections for sales and plans for capital spending and hiring over the next six months — declined by 3.9 points, from 73.5 in the second quarter to 69.6 in the third quarter. The Index remains below its historical average of 79.6. It remains well above 50, indicating continued economic expansion — although well below the full potential of U.S. economic growth.

According to the Business Roundtable third quarter 2016 CEO Economic Outlook Survey, CEO expectations for sales over the next six months declined by 9.3 points, while expectations for hiring declined by 3.4 points from last quarter. CEO plans for capital expenditures ticked up slightly by 0.8 point relative to last quarter.

In their fourth estimate of real GDP growth for 2016, CEOs expect 2.2 percent growth, a slight tick upward from their 2.1 percent estimate in the second quarter of 2016 and roughly in line with other well-regarded estimates.

_____

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.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2153.74 as this post is written