A man pumps gasoline into his car at a gas station in Millbrae, California, the United States, May 16, 2022.Oil prices rose on Monday as gasoline futures extended gains amid tight supplies. (Photo by Li Jianguo/Xinhua)
The lower growth forecast occurs against the backdrop of the rising geopolitical uncertainty, surging inflation in the country and a more volatile global market.
by Matthew Rusling
WASHINGTON, May 24 (Xinhua) -- Analysts have projected that the U.S. economy will face slower growth and higher inflation at year-end, showed a survey released on Monday by the National Association for Business Economics (NABE).
The median forecast for inflation-adjusted gross domestic product (GDP) of this year's fourth quarter is a 1.8-percent increase from the same period of 2021, compared with a median projection of 2.9 percent in February, the survey showed.
"Seventy-seven percent of the panelists indicate the risks to U.S. economic growth are tilted to the downside this year, with monetary policy missteps representing the greatest downside risk," said NABE Outlook Survey Chair Yelena Shulyatyeva, a senior U.S. economist at Bloomberg Economics.
The lower growth forecast occurs against the backdrop of the rising geopolitical uncertainty, surging inflation in the country and a more volatile global market.
People visit the 2022 Offshore Technology Conference in Houston, Texas, the United States, on May 4, 2022. (Xinhua/Xu Jianmei)
The NABE survey conducted on May 2-10 presents the consensus macroeconomic forecast of a panel of 53 professional forecasters.
NABE panelists have raised their projections for both the consumer price index (CPI) and the personal consumption expenditures (PCE) price index, the Fed's preferred gauge to measure the level of inflation.
According to the survey, the CPI is projected to rise 5.6 percent year-on-year in the fourth quarter this year, two percentage points higher than the median 3.6-percent forecasted in the February survey. Meanwhile, nearly 90 percent of panelists anticipate core PCE inflation rate will peak by this year's end.
"NABE Outlook Survey panelists continue to ratchet up their expectations for inflation rates in both 2022 and 2023," said NABE President David Altig, who also serves as the executive vice president and director of research at the Federal Reserve Bank of Atlanta.
Photo taken on May 11, 2022 shows pedestrians walking on the street in Washington, D.C., the United States. U.S. consumer inflation in April surged by 8.3 percent from a year ago, marking the second straight month of inflation over 8 percent, the U.S. Labor Department reported Wednesday. (Xinhua/Liu Jie)
In a webinar on Monday, Shulyatyeva noted that it is important that "the whole forecast horizon was lifted higher," while "participants continued to downgrade economic growth."
On a possible economic recession in the United States, 53 percent of respondents assign a more than 25-percent probability of a recession occurring within the next 12 months, and an additional 40 percent of the panel suggest the possibility is between 11 percent and 25 percent, the survey found.
Just over a quarter of panelists believe a recession will occur in the second half of next year, while 25 percent expect a recession either by this year's end or in the first half of next year. One-third of panelists suggests a recession will not occur until 2024 or later, the survey said.
"What we found out was there's so much uncertainty about this question that some answers may seem contradictory," Shulyatyeva said. ■