NABE Outlook February 2013

NABE Forecasters See Rising GDP Despite Fiscal Threats

The February 2013 NABE Outlook Survey report presents the consensus of macroeconomic forecasts from a panel of 49 professional forecasters. (See last page for listing.) The survey, covering the outlook for 2013 and 2014, was conducted January 28-February 5, 2013. The NABE Outlook Survey originated in 1965 and is one of three surveys conducted by NABE; the others are the NABE Industry Survey and the NABE Economic Policy Survey. Founded in 1959, the National Association for Business Economics is the professional association for those who use economics in their work. NABE has 2,400 members and 37 chapters nationwide. Dr. Nayantara Hensel, National Defense University; Ken Simonson, Associated General Contractors of America; William Strauss, Federal Reserve Bank of Chicago; Richard Wobbekind, University of Colorado; and Clare Zempel, Zempel Strategic, conducted the analysis for this report. The views expressed in this report are those of the analysts and do not necessarily represent the views of their affiliated companies or institutions. This report may be reprinted in whole or in part with a proper citation to NABE.

Summary

“NABE panelists expect real GDP to grow by 2.4% from the fourth quarter of 2012 to the fourth quarter of 2013 and to grow by 3% for 2014,” said Dr. Nayantara Hensel, Chair of the NABE Outlook Survey Committee and Professor of Industry and Business at National Defense University. “Over 95% of the panelists believe that growth in real GDP in 2013 is likely to be negatively affected by uncertainty surrounding the US fiscal imbalances and issues linked to the continuing resolution, sequestration, and the debt ceiling. Almost 60% of those surveyed suggest that sequestration will occur in either partial form or full form on March 1. Moreover, they forecast that government consumption expenditures and gross investment will decline by 1% in 2013 and will be followed by a milder 0.2% decline in 2014. They also expect that real personal consumption expenditures will continue last year’s 1.9% growth rate in 2013 and then accelerate to 2.5% growth in 2014. Panelists suggest strong growth in residential investment, housing starts, and home prices. Although industrial production and nonresidential structures are forecast to grow slightly more slowly, panelists continue to forecast strong growth in nonresidential equipment and software and light vehicle sales. Those surveyed indicated that inflation will continue to remain close to 2% through 2014 and, on a positive note, suggest that the civilian unemployment rate will show some improvement in 2013 and 2014. Finally, panelists believe that several of the European countries are likely to need ‘bailout’ packages. About one-third of panelists believe that Spain will require a larger ‘bailout’ package in 2013 than was previously anticipated, almost a quarter of the panelists believe that Italy will require a ‘bailout’ package in 2013, and about a fifth of panelists believe that Ireland will require a second ‘bailout’ package in 2013. Only 14% of the panelists suggest that Greece may break away from the euro currency in 2013.”

Highlights

 

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February 2013 NABE Outlook

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