The National Association for Business Economics (NABE) said that panelists in its Outlook Survey downgraded their estimates for growth in 2015. Business economists now expect real GDP growth of 2.4 percent this year, down from 3.1 percent in the March survey. This reflects recent headwinds in the U.S. economy, with 80 percent and 72 percent suggesting that a stronger U.S. dollar and slower growth in China, respectively, were having a negative impact on U.S. economic growth. To illustrate this point, the estimates for export growth have declined from 5.4 percent in December to 2.1 percent in the current report.
Moreover, economists expect industrial production to expand more slowly, down from a forecast of 3.7 percent in the March survey to 2.3 percent now. The good news is that this is anticipated to rebound to 3.0 percent growth in 2016, mirroring the outlook for 2.9 percent real GDP growth next year. Americans are seen purchasing 16.8 million light vehicles in 2015 and 17.0 million units in 2016, with housing starts rising from 1.10 million to 1.28 million in 2015 and 2016, respectively. In terms of the labor market, nonfarm payrolls are predicted to grow by 217,000 each month this year.
Looking at monetary policy, 74 percent of business economists expect the Federal Reserve to begin raising short-term rates in the third quarter.
Chad Moutray is the chief economist, National Association of Manufacturers, and he was a panelist in this survey.