Tag Archives: Economic Forecasts

Philadelphia Fed – 1st Quarter 2018 Survey Of Professional Forecasters

The Philadelphia Fed 1st Quarter 2018 Survey of Professional Forecasters was released on February 9, 2018.  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 2018:  2.8%

full-year 2019:  2.5%

full-year 2020:  2.0%

full-year 2021:  1.7%

Unemployment Rate: (annual average level)

for 2018: 4.0%

for 2019: 3.8%

for 2020: 3.9%

for 2021: 4.0%

Regarding the risk of a negative quarter in real GDP in any of the next few quarters, mean estimates are 5.8%, 9.1%, 11.4%, 13.6% and 16.8% for each of the quarters from Q1 2018 through Q1 2019, respectively.

As well, there are also a variety of time frames shown (present quarter through the year 2027) 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 1.7% to 2.7% range.

_____

I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site 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 2552.37 as this post is written

The February 2018 Wall Street Journal Economic Forecast Survey

The February 2018 Wall Street Journal Economic Forecast Survey was published on February 8, 2018.  The headline is “Economists Stick With Optimistic U.S. Outlook Despite Market Turmoil.”

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:

Forecasters see the U.S. economy gathering steam this year and the Federal Reserve raising short-term interest rates three or perhaps four times by the end of 2018.

Economists surveyed in recent days by The Wall Street Journal on average predicted U.S. gross domestic product would rise 2.8% in 2018, accelerating from 2.5% growth in the fourth quarter of 2017 versus a year earlier, supported by the recent package of tax-code changes.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 13.97%. The individual estimates, of those who responded, ranged from 0% to 35%.  For reference, the average response in January’s survey was 13.11%.

As stated in the article, the survey’s respondents were 63 academic, financial and business economists.  Not every economist answered every question.  The survey was conducted February 2 – February 6, 2018.

The current average forecasts among economists polled include the following:

GDP:

full-year 2018:  2.8%

full-year 2019:  2.3%

full-year 2020:  2.0%

Unemployment Rate:

December 2018: 3.8%

December 2019: 3.8%

December 2020: 4.1%

10-Year Treasury Yield:

December 2018: 3.13%

December 2019: 3.46%

December 2020: 3.54%

CPI:

December 2018:  2.2%

December 2019:  2.3%

December 2020:  2.3%

Crude Oil  ($ per bbl):

for 12/31/2018: $61.00

for 12/31/2019: $60.19

for 12/31/2020: $59.39

(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 site 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 2626.82 as this post is written

The January 2018 Wall Street Journal Economic Forecast Survey

The January 2018 Wall Street Journal Economic Forecast Survey was published on January 11, 2018.  The headline is “Economists Credit Trump as Tailwind for U.S. Growth, Hiring and Stocks.”

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:

Asked to rate Mr. Trump’s policies and actions to date, a majority of economists said he had been somewhat or strongly positive for job creation, gross domestic product growth and the stock market. Most also said he had been either neutral or positive for the country’s long-term growth trajectory, while his influence on financial stability was seen as largely neutral.

also:

Looking forward, the economists surveyed in recent days had high hopes for 2018.

On average, the forecasters predicted GDP would expand a healthy 2.7% this year. They saw the unemployment rate, which was 4.1% in December, falling to 3.9% by midyear and 3.8% in December. The pace of hiring was expected to slow further, with monthly nonfarm payroll gains set to average 165,000 in 2018. Monthly job gains averaged 171,000 in 2017 and 187,000 in 2016, according to the Labor Department.

The probability of a recession in the next 12 months ticked down in January to 13%, the lowest average since September 2015. More than two-thirds of forecasters said they saw the risks to the growth outlook as tilted to the upside.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 13.11%. The individual estimates, of those who responded, ranged from 0% to 30%.  For reference, the average response in December’s survey was 14.12%.

As stated in the article, the survey’s respondents were 68 academic, financial and business economists.  Not every economist answered every question.  The survey was conducted January 5 – January 9, 2018.

The current average forecasts among economists polled include the following:

GDP:

full-year 2017:  2.5%

full-year 2018:  2.7%

full-year 2019:  2.2%

full-year 2020:  2.0%

Unemployment Rate:

December 2018: 3.8%

December 2019: 3.8%

December 2020: 4.1%

10-Year Treasury Yield:

December 2018: 2.98%

December 2019: 3.31%

December 2020: 3.41%

CPI:

December 2017:  2.1%

December 2018:  2.1%

December 2019:  2.3%

December 2020:  2.3%

Crude Oil  ($ per bbl):

for 12/31/2018: $58.31

for 12/31/2019: $57.46

for 12/31/2020: $58.91

(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 site 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 2767.56 as this post is written

CEO Confidence Surveys 4Q 2017 – Notable Excerpts

On January 4, 2018, The Conference Board released the 4th Quarter Measure Of CEO Confidence.   The overall measure of CEO Confidence was at 63, up from 59 in the third quarter. [note:  a reading of more than 50 points reflects more positive than negative responses]

Notable excerpts from this January 4 Press Release include:

CEOs’ assessment of current economic conditions improved considerably. Currently, 71 percent say conditions are better compared to six months ago, up from 56 percent in the third quarter. However, CEOs are moderately less optimistic in their appraisal of current conditions in their own industries. Now, 49 percent say conditions in their own industries have improved, down from 53 percent last quarter.

Looking ahead, CEOs’ expectations regarding the short-term outlook was significantly better. Now, 47 percent expect economic conditions to improve over the next six months, compared to just 39 percent last quarter. CEOs were also more upbeat about short-term prospects in their own industries over the next six months, with 41 percent anticipating conditions will improve, versus 36 percent in the third quarter of 2017.

The Business Roundtable last month also released its CEO Economic Outlook Survey for the 4th Quarter of 2017.   Notable excerpts from the December 5, 2017 release, titled “Business Roundtable CEO Economic Outlook Index Reaches Highest Level in Nearly Six Years“:

The Business Roundtable Q4 CEO Economic Outlook Index — a composite of CEO projections for sales and plans for capital spending and hiring over the next six months — increased to 96.8 for the fourth quarter of 2017, up from 94.5 in the third quarter.

The Index reached its highest level since the first quarter of 2012 (96.9). The Index has significantly exceeded its historical average of 80.3 for four quarters in a row and remains well above 50, suggesting that CEOs continue to expect the U.S. economy to expand at a healthy pace.

CEO plans for capital investment rose to their highest level since the second quarter of 2011. Expectations for sales picked up by 5.1 points. Hiring plans dipped 4.5 points from Q3, but remain near their highest level in four years.

In their first GDP estimate for 2018, CEOs project 2.5 percent GDP growth for the year.

Additional details can be seen in the sources mentioned above.

_____

I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site 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 2747.71 as this post is written

The December 2017 Wall Street Journal Economic Forecast Survey

The December 2017 Wall Street Journal Economic Forecast Survey was published on December 13, 2017.  The headline is “U.S. Economic Expansion Could Become Longest on Record.”

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:

Forecasters are increasingly optimistic the U.S. economic expansion could continue beyond the 2020 presidential election, aided by Republican tax legislation that is expected to lift growth over the next several years.

The slow-but-sturdy expansion that began in mid-2009 already is the third-longest in U.S. history and, if it continues into the second half of 2019, will exceed the 10-year record set by the 1990s economic boom.

Most of the private-sector economic forecasters surveyed in recent days by The Wall Street Journal said the odds of a new recession by late 2020 were below 50%. The average probability of a recession in the next year was 14%, with the odds creeping up to 29% in two years and 43% in three years.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 14.12%. The individual estimates, of those who responded, ranged from 0% to 33%.  For reference, the average response in November’s survey was 14.64%.

As stated in the article, the survey’s respondents were 62 academic, financial and business economists.  Not every economist answered every question.  The survey was conducted December 8-11.

The current average forecasts among economists polled include the following:

GDP:

full-year 2017:  2.5%

full-year 2018:  2.6%

full-year 2019:  2.1%

full-year 2020:  2.0%

Unemployment Rate:

December 2017: 4.1%

December 2018: 3.9%

December 2019: 3.9%

December 2020: 4.2%

10-Year Treasury Yield:

December 2017: 2.42%

December 2018: 2.93%

December 2019: 3.26%

December 2020: 3.38%

CPI:

December 2017:  2.0%

December 2018:  2.1%

December 2019:  2.3%

December 2020:  2.3%

Crude Oil  ($ per bbl):

for 12/31/2017: $56.25

for 12/31/2018: $56.20

for 12/31/2019: $56.30

for 12/31/2020: $57.98

(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 site 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 2667.0 as this post is written

Philadelphia Fed – 4th Quarter 2017 Survey Of Professional Forecasters

The Philadelphia Fed 4th Quarter 2017 Survey of Professional Forecasters was released on November 13, 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:  2.2%

full-year 2018:  2.5%

full-year 2019:  2.1%

full-year 2020:  1.9%

Unemployment Rate: (annual average level)

for 2017: 4.4%

for 2018: 4.1%

for 2019: 4.0%

for 2020: 4.1%

Regarding the risk of a negative quarter in real GDP in any of the next few quarters, mean estimates are 6.3%, 10.4%, 12.6%, 14.7% and 17.0% for each of the quarters from Q4 2017 through Q4 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 1.4% to 2.3% range.

_____

I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site 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 2582.00 as this post is written

The November 2017 Wall Street Journal Economic Forecast Survey

The November 2017 Wall Street Journal Economic Forecast Survey was published on November 9, 2017.  The headline is “Forecasters Predict Nafta Withdrawal Would Slow U.S. Growth.”

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:

Forecasters this month saw GDP growth of 2.5% this year and again in 2018. The pace of expansion was then seen easing to 2.1% in 2019 and 2% in 2020, closer to the average since the 2007-09 recession ended. Last month, economists said the proposed GOP tax plan would produce several years of stronger growth if enacted by Congress, though forecasters were divided over its likely long-term effects.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 14.64%. The individual estimates, of those who responded, ranged from 0% to 35%.  For reference, the average response in October’s survey was 15.85%.

As stated in the article, the survey’s respondents were 59 academic, financial and business economists.  Not every economist answered every question.  The survey was conducted November 3-7.

The current average forecasts among economists polled include the following:

GDP:

full-year 2017:  2.5%

full-year 2018:  2.5%

full-year 2019:  2.1%

full-year 2020:  2.0%

Unemployment Rate:

December 2017: 4.1%

December 2018: 3.9%

December 2019: 4.0%

December 2020: 4.3%

10-Year Treasury Yield:

December 2017: 2.47%

December 2018: 3.00%

December 2019: 3.31%

December 2020: 3.47%

CPI:

December 2017:  1.9%

December 2018:  2.2%

December 2019:  2.3%

December 2020:  2.3%

Crude Oil  ($ per bbl):

for 12/31/2017: $53.72

for 12/31/2018: $54.22

for 12/31/2019: $54.91

for 12/31/2020: $57.06

(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 site 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 2571.07 as this post is written

The October 2017 Wall Street Journal Economic Forecast Survey

The October 2017 Wall Street Journal Economic Forecast Survey was published on October 12, 2017.  The headline is “Economists See GOP Tax Plan Producing Growth Spurt, But Split Over Long-Term Effect.”

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:

An overwhelming majority of forecasters in The Wall Street Journal’s monthly survey of economists said the GOP tax plan unveiled last month would, if implemented, raise the growth rate for U.S. gross domestic product over the next two years. Some 60% saw a modest lift to output compared with its current trend, while 27% said the annual growth rate would jump by more than half a percentage point.

The announced framework, which lacks some details and could change as lawmakers flesh it out in the coming weeks, features lower tax rates on corporate profits, incentives for business investment and fewer individual income tax brackets, among other changes.

But roughly half of the economists said any growth spurt would fade over time. Asked about the tax plan’s likely effect on the economy’s long-run growth rate, 48% predicted a modest increase while 38% said the U.S. would remain on its current trajectory. Just 4% said the tax plan would boost the GDP growth rate by more than 0.5 percentage point a year, while 10% said growth would be slower than if there had been no tax changes.

also:

As for the federal budget deficit, 85% of economists said the GOP tax plan would cause it to widen over the next decade.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 15.85%. The individual estimates, of those who responded, ranged from 0% to 33%.  For reference, the average response in September’s survey was 16.08%.

As stated in the article, the survey’s respondents were 59 academic, financial and business economists.  Not every economist answered every question.  The survey was conducted October 6-10.

The current average forecasts among economists polled include the following:

GDP:

full-year 2017:  2.3%

full-year 2018:  2.4%

full-year 2019:  2.0%

Unemployment Rate:

December 2017: 4.2%

December 2018: 4.0%

December 2019: 4.1%

10-Year Treasury Yield:

December 2017: 2.46%

December 2018: 3.00%

December 2019: 3.30%

CPI:

December 2017:  1.8%

December 2018:  2.2%

December 2019:  2.4%

Crude Oil  ($ per bbl):

for 12/31/2017: $50.26

for 12/31/2018: $52.51

for 12/31/2019: $53.64

(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 site 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 2553.80 as this post is written

CEO Confidence Surveys 3Q 2017 – Notable Excerpts

On October 5, 2017, The Conference Board released the 3rd Quarter Measure Of CEO Confidence.   The overall measure of CEO Confidence was at 59, down from 61 in the second quarter. [note:  a reading of more than 50 points reflects more positive than negative responses]

Notable excerpts from this October 5 Press Release include:

CEOs’ assessment of current economic conditions was mixed. Currently, 56 percent say conditions are better compared to six months ago, down from 60 percent in the second quarter. Business leaders, however, are more positive in their appraisal of current conditions in their own industries. Now, 53 percent say conditions in their own industries have improved, up from 47 percent last quarter.

Looking ahead, CEOs’ optimism regarding the short-term outlook for the economy is slightly more pessimistic. Currently, 39 percent expect economic conditions to improve over the next six months, compared to 41 percent last quarter. However, 14 percent expect economic conditions to worsen, compared to 3 percent last quarter. About 36 percent of CEOs anticipate an improvement in their own industries over the next six months, down from 48 percent in the second quarter of this year.

The Business Roundtable last month also released its CEO Economic Outlook Survey for the 3rd Quarter of 2017.   Notable excerpts from the September 19, 2017 release, titled “Business Roundtable CEO Economic Outlook Index Shows Signs of Continued Confidence in 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 — stood at 94.5 for the third quarter of 2017, edging up from 93.9 in the second quarter.

For the second quarter in a row, the Index reached its highest level since the second quarter of 2014 (95.4). The Index has also significantly exceeded its historical average of 80.3 for three quarters in a row and remains well above 50, suggesting CEOs’ continued confidence in the U.S. economy.

CEO plans for hiring jumped from the previous quarter, up 9.9 points to 80.2 in the third quarter – the highest reading in more than six years. Expectations for sales dipped by 7.4 to 116.9 for the third quarter, while plans for capital investment moderated slightly from 87.2 to 86.4.

CEOs project 2.1 percent GDP growth in 2017, up 0.1 percent from their projection for 2017 made in June.

_____

I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site 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 2546.60 as this post is written

September 2017 Duke/CFO Global Business Outlook Survey – Notable Excerpts

On September 8, 2017 the September 2017 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:

The survey has been conducted for 86 consecutive quarters and spans the globe, making it the world’s longest-running and most comprehensive research on senior finance executives. This quarter, nearly 850 CFOs responded to the survey, which ended Sept. 8. Results are for the U.S. unless stated otherwise.

For the second quarter in a row, and for only the second time in the history of the survey, difficulty attracting and retaining qualified employees is the top concern of U.S. CFOs. This same concern ranks highly in many places around the world.

also:

Due in part to the tight labor market, U.S. companies expect to pay higher wages, with median wage growth of about 3 percent over the next 12 months. Wage growth should be strongest in the tech, health care, and construction industries.

also:

The Optimism Index fell slightly this quarter to 66 on a 100-point scale. That’s one point lower than last quarter but still far above the long-run average of 60.

“CFOs remain optimistic not only about the overall economy but about their own firms, too,” said Chris Schmidt, senior editor at CFO Research. “Our analysis of past results shows the CFO Optimism Index is an accurate predictor of hiring plans and overall GDP growth.”

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 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 site 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 2499.53 as this post is written