Economists Foresee GDP Growth Averaging Above 3% Through 2014

In spite of commodity price increases, turmoil in the Middle East and now an earthquake and tsunami in Japan, macroeconomic forecasters of the U.S. economy remain relatively upbeat about growth prospects.

In the March issue of Blue Chip Economic Indicators, the consensus forecasts of U.S. real gross domestic product were down slightly for 2011 at 3.1%. The forecast for’12 remained at 3.3%. The ’11 forecasts for real disposable income and personal consumption expenditures also fell a tenth-point each to 2.6% and 3.1% respectively, while the ’12 predictions have DPI up a tenth to 2.5% and PCE flat at 2.9%.

The group also issued its latest long-range forecasts. GDP growth is forecast at 3.2% in ’13 and 3.1% in ’14 before falling below the so-called “trend rate” of 3% in ’15 through ’17. DPI and PCE are forecast to show only moderate growth throughout the five-year period, averaging in the 2.6% to 3% range. Consumer inflation is also predicted to remain moderate, below 2.5%, throughout the period.