Economists Upgrade Forecast for GDP

Staffing Industry Analysts (08/11/23)

Economists indicate a growing sense of optimism regarding the trajectory of the US economy over the next three quarters, according to the Philadelphia Federal Reserve’s Survey of Professional Forecasters report for the third quarter, released Friday. The panel now projects real GDP to grow at an annual rate of 1.9% this quarter, a notable upswing from the 0.6% increase forecast back in May.

The forecasters also upgraded their outlook for the following two quarters. They now expect GDP growth of 1.4% in the fourth quarter, up from their prediction in February of flat growth; their outlook edged upward to 1.1% growth for the first quarter of next year from 1.0% forecast in the prior survey.

In addition, they now expect GDP to expand at an annual rate of 2.1% in 2023 and 1.3% in 2024, up from their previous predictions of 1.3% and 1.0%, respectively.

The panel of 37 economists polled for the report also revised upward their estimate for job growth over the next four quarters, with projections for the average annual level of nonfarm payroll employment suggesting job gains at a monthly rate of 288,600 in 2023 and 94,800 in 2024. In addition, the panelists now anticipate unemployment rates of 3.6% in the third quarter of 2023 and 3.7% in the fourth quarter, down from estimates 3.8% and 4.0%, respectively, in the May survey.

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