Philly Fed: Economic Forecasters See Little Change in Outlook for 4Q2012

November 9th, 2012
in econ_news, syndication

Follow up:

From the Philly Fed:

The outlook for the U.S. economy is little changed from the survey of three months ago, according to 39 forecasters surveyed by the Federal Reserve Bank of Philadelphia. The forecasters expect real GDP to grow at an annual rate of 1.8 percent this quarter, down from the previous estimate of 2.2 percent. Over the next three quarters, they expect GDP growth to average 2.1 percent, down from the previous average of 2.2 percent. On an annual-average over annual-average basis, the forecasters see real GDP growing 2.2 percent in 2012, unchanged from their prediction in the survey of three months ago. The forecasters predict real GDP will grow 2.0 percent in 2013, 2.7 percent in 2014, and 2.9 percent in 2015.

The estimates for unemployment also changed little from the projections in the last survey. Unemployment is projected to be an annual average of 8.1 percent in 2012, before falling to 7.8 percent in 2013, 7.4 percent in 2014, and 6.9 percent in 2015. The projections are similar to those of the previous survey.

On the employment front, the forecasters have made small revisions to their estimates of the growth in jobs over the next four quarters. The forecasters see nonfarm payroll employment growing at a rate of 148,700 jobs per month this quarter and 127,400 jobs per month next quarter. The forecasters’ projections for the annual-average level of nonfarm payroll employment are almost identical to those of three months ago. The projections suggest job gains at a monthly rate of 155,600 in 2012 and 143,300 in 2013, 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.)

Median Forecasts for Selected Variables in the Current and Previous Surveys
Real GDP (%)
Unemployment Rate (%)
Payrolls (000s/month)
Previous
New
Previous
New
Previous
New
Quarterly data
2012:Q4
2.2
1.8
8.1
7.9
135.3
148.7
2013:Q1
1.8
1.7
8.0
7.9
151.7
127.4
2013:Q2
2.3
2.0
7.9
7.8
139.7
146.1
2013:Q3
2.5
2.7
7.8
7.8
149.0
170.2
2013:Q4
N.A.
2.8
N.A.
7.6
N.A.
178.3
Annual data (projections are based on annual-average levels)
2012
2.2
2.2
8.2
8.1
154.6
155.6
2013
2.1
2.0
7.9
7.8
143.2
143.3
2014
2.7
2.7
7.3
7.4
N.A.
N.A.
2015
3.1
2.9
7.0
6.9
N.A.
N.A.

The forecasters expect current-quarter headline CPI inflation to average 2.3 percent, up from the last survey’s estimate of 2.0 percent. They predict current-quarter headline PCE inflation of 2.0 percent, identical to that in the last survey.

Measured on a fourth-quarter over fourth-quarter basis, headline CPI inflation is expected to average 1.9 percent in 2012, up slightly from 1.8 percent in the last survey. The forecasts for 2.2 percent in 2013 and 2.3 percent in 2014 are the same as they were in the last survey.

Forecasters also expect fourth-quarter over fourth-quarter headline PCE inflation at levels unchanged from the previous survey: 1.7 percent in 2012, 2.0 percent in 2013, and 2.2 percent in 2014.

Revisions to the projections for long-term inflation are also small. Over the next 10 years, 2012 to 2021, the forecasters expect headline CPI inflation to average 2.30 percent at an annual rate. The corresponding estimate for 10-year annual-average headline PCE inflation is 2.10 percent.

Median Short-Run and Long-Run Projections for Inflation (Annualized Percentage Points)
Headline CPI
Core CPI
Headline PCE
Core PCE
Previous
Current
Previous
Current
Previous
Current
Previous
Current
Quarterly
2012:Q4
2.0
2.3
2.0
1.8
2.0
2.0
1.8
1.6
2013:Q1
2.1
2.1
2.0
1.9
2.0
1.8
1.9
1.8
2013:Q2
2.1
2.2
2.0
2.0
2.0
2.0
2.0
1.9
2013:Q3
2.2
2.2
2.1
2.0
2.1
2.0
2.0
1.9
2013:Q4
N.A.
2.3
N.A.
2.0
N.A.
2.1
N.A.
1.9
Q4/Q4 Annual Averages
2012
1.8
1.9
2.2
2.0
1.7
1.7
1.9
1.7
2013
2.2
2.2
2.0
2.0
2.0
2.0
2.0
1.9
2014
2.3
2.3
2.2
2.2
2.2
2.2
2.0
2.0
Long-Term Annual Averages
2012-2016
2.20
2.28
N.A.
N.A.
2.00
2.00
N.A.
N.A.
2012-2021
2.35
2.30
N.A.
N.A.
2.20
2.10
N.A.
N.A.

For the current quarter, the forecasters predict a 13.5 percent chance of negative growth, down from 17.0 percent in the survey of three months ago. The forecasters have little revised the chance of a contraction in real GDP in any of the next three quarters. As the table below shows, the panelists have made only small revisions to their forecasts for the following three quarters.

Risk of a Negative Quarter (%)
Quarterly data
Previous
New
2012: Q4
17.0
13.5
2013: Q1
21.2
23.0
2013: Q2
21.0
21.7
2013: Q3
19.1
17.9
2013: Q4
N.A.
16.4

 

Read the source report from the Philly Fed.

 









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