NABE Outlook Survey

May 2024

NABE Panel Forecasts Higher Inflation Through 2024, Dimming Hopes for the Size and Timing of Fed Rate Cuts in 2024; Economic Growth Still Expected to be Strong

The May 2024 NABE Outlook presents the consensus macroeconomic forecast of a panel of 43 professional forecasters (see last page for listing). The survey, covering the outlook for 2024 and 2025, was conducted April 23 – May 6, 2024. The NABE Outlook Survey originated in 1965,and is one of three surveys conducted by the National Association for Business Economics (NABE); the others are the NABE Business Conditions 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 over 2,900 members and 44 chapters nationwide. Mervin Jebaraj (chair), University of Arkansas; Kathy Bostjancic, Nationwide; Beth Ann Bovino, U.S. Bank; Martin Holdrich, Woods & Poole Economics, Inc.; Jack Kleinhenz, CBE, National Retail Federation; and Ryan Sweet, Oxford Economics, conducted the analysis of survey responses for this report. The views expressed in this report are those of the panelists, and do not necessarily represent the views of their affiliated companies or institutions. This report may be reproduced in whole or in part with appropriate citation to NABE.

SUMMARY: “The NABE Outlook Survey panel expects inflation to remain a concern throughout 2024,” said NABE President Ellen Zentner, chief U.S. economist, Morgan Stanley. “The May forecast calls for inflation to remain elevated at 2.6%, half a percentage point higher than the forecast in the February 2024 survey. With the higher inflation expectations, panelists now anticipate the Federal Reserve’s Open Market Committee will cut rates by half a percentage point—down from three-quarters of a point and to occur later in the year than previously expected. The yield on 10-year Treasury notes at the end of 2024 is forecasted to be 4.2%, up from 3.8% in the February outlook.”

“Following the stronger employment growth in the first quarter of the year, panelists now forecast average employment growth to gradually slow through 2024 to 125,000 jobs per month in the fourth quarter of 2024,” added NABE Outlook Survey Chair Mervin Jebaraj, director, Center for Business and Economic Research at the University of Arkansas. “Panelists still anticipate stronger economic growth in 2024 than in previous NABE Outlook surveys, and 90% of them expect a soft landing in 2024. Economic growth projections are more pessimistic than the Federal Reserve’s economic projections published in March which forecasted weaker economic growth and higher headline inflation in 2024.”