Livingston Survey: Economists’ View of the Economy

Econintersect:  The Philly Fed sponsored Livingston Survey predicts higher economic growth and lower unemployment in the second half of 2011.

The Philadelphia Fed’s Livingston Survey is the oldest continuous survey of economists’ expectations. The survey was started in 1946 by the late columnist Joseph A. Livingston. It summarizes the forecasts of economists from industry, government, banking, and academia.  This year 35 economists participated.

Economists appear to be like consumers, pessimistic short term view and optimistic long term view.  In GDP forecasting, they have lowered their forecast from 2.5% to 2.2%  growth in the half year ending with 2Q2011, and raised their forecast from 2.9% to 3.2% growth in the half year ending 4Q2011.  

The forecasters see the unemployment rate at 8.6% at year end.

However, the economists see inflation taking hold with the overall CPI showing a 3.1% growth YoY at the end of 2011 – however, this is also the current YoY CPI inflation rate.  Econintersect translates this to mean that the economists see the current rates as the peak rates for inflation.

The economists believe interest rates will remain low.

Source: Philly Fed