NABE: Economic Growth to Accelerate, Panel Says
The NABE released its December 2013 Outlook, which presents the consensus of macroeconomic forecasts from a panel of 51 professional forecasters. The survey, covering the outlook for 2013 and 2014, was conducted November 8-19, 2013.
“Economists participating in the December 2013 NABE Outlook Survey expect the pace of economic growth to accelerate in both 2013 and 2014,” said survey chair Timothy Gill, deputy chief economist at the National Electrical Manufacturers Association.
“Looking ahead to next year, panelists forecast real GDP growth of 2.8% in 2014, down slightly from the 3% gain expected in September,” Gill continued. “The U.S. economy is likely to experience some headwinds in 2014. Most panelists believe that the Federal Reserve will begin to rein in its policy of quantitative easing in the first half of 2014, and that additional sequestration cuts will negatively affect economic growth throughout the year. However, survey results reflect the view that another government shutdown or a default on federal obligations early in 2014 is unlikely.”
Some of the survey highlights included:
• Real GDP is expected to expand at a slightly higher rate in 2013 than previously forecast, and to accelerate in 2014. The panel expects a 2.1% real GDP growth rate—measured from the Q4/12 to the Q4/13. That result is an increase from the consensus GDP growth forecast of 1.9% in the September survey.
• Labor markets are projected to improve. Nonfarm payrolls are forecast to post an average monthly gain of 177,500 for all of 2013, less than the 183,000 recorded in 2012 and below the 189,000 predicted in the September survey. However, panelists anticipate stronger job creation in 2014, with an average monthly nonfarm payroll increase of 197,000.
• Tighter fiscal policy is playing a role in lowering the expectations for near-term economic growth. Three-quarters of the panelists believe October’s partial shutdown of the federal government will have a negative impact on Q4/13 real GDP growth. Even so, most expect the impact to be modest, with 73% predicting a loss of less than 0.5 percentage points of growth. Meanwhile, 88% of panelists predict additional sequestration cuts of some form will take effect in 2014, but 76% expect the negative impact will be limited to less than 0.5 percentage points of real GDP growth.
To read the full report, click here.