Wolters Kluwer: Leading U.S. economists anticipate a slowdown in GDP growth, no recession

Wolters Kluwer has published the August 2024 issue of its Blue Chip Economic Indicators survey, which finds a majority (79%) of the panel’s 49 leading economists predicting that the U.S. economy has yet to feel the full restraint of earlier Fed rate hikes. However, the survey also indicates broad consensus that the economy will circumvent a recession to achieve the desired “soft landing” following an initial slowdown in GDP growth.

Since 1976, Wolters Kluwer Blue Chip Economic Indicators has been the leading monthly forecast sourced from an expert panel of economists that are employed by some of America’s largest and most respected manufacturers, banks, insurance companies.

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Highlights include:

• Most economists (93%) expect the first Fed rate cut to occur in September, up from 55% last month.

• Only 17% of economists believe that the first rate cut will equate to 50 basis points (bps), while the vast majority (83%) anticipate a cut of 25bps.

• Economists anticipate that GDP growth will slow to 1.5% by next quarter before gradually rebounding to an above-trend 2.1% in the fourth quarter of next year.

• The consensus forecast places only a 28% probability that inflation readings will turn up again in the second half of 2024.

Each month’s Blue Chip Economic Indicators survey highlights the predictions of each individual panel member as well as a consensus – or average – forecast for the direction of variables such as real gross domestic product (GDP), consumer price index and the unemployment rate.

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