Research >> Economics
Forecasters Predict Lower Growth over the Next Three Years
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The economy looks weaker now than it did three months ago, according to 40 forecasters surveyed by the Federal Reserve Bank of Philadelphia. The forecasters predict real GDP will grow at an annual rate of 2.0 percent this quarter and 2.5 percent next quarter. On an annual-average over annual-average basis, real GDP will grow 2.1 percent in 2016, down 0.5 percentage point from the previous estimate. The forecasters predict real GDP will grow 2.4 percent in 2017 and 2.7 percent in 2018, both down 0.1 percentage point from the estimates of three months ago. For 2019, real GDP is estimated to grow at 2.3 percent.
A slightly positive outlook for the labor market accompanies the outlook for weaker output growth. The forecasters predict that the unemployment rate will average 4.8 percent in 2016, before falling to 4.6 percent in 2017, 4.6 percent in 2018, and 4.7 percent in 2019. The projections for 2017 and 2018 are slightly below those of the last survey.
The panelists also predict a small improvement on the employment front. They have revised upward their estimates for job gains in 2016. The forecasters see nonfarm payroll employment growing at a rate of 195,000 jobs per month this quarter, 183,200 jobs per month next quarter, 195,900 jobs per month in the third quarter of 2016, and 152,600 jobs per month in the fourth quarter of 2016. The forecasters’ projections for the annual-average level of nonfarm payroll employment suggest job gains at a monthly rate of 204,300 in 2016 and 165,000 in 2017, as the table below shows. (These annual-average estimates are computed as the year-to-year change in the annual-average level of nonfarm payroll employment, converted to a monthly rate.)
Posted: February 12, 2016 Friday 10:00 AM