U.S. Macro Forecasts Slide Again; What’s The Risk?

The recent spate of weaker than expected economic data on jobs, spending and housing helped push down most forecasts of economic growth in the U.S. this year, according to the latest consensus data from Blue Chip Economic Indicators.

The forecast for real growth of gross domestic product for 2011 nosed down another 0.1 point to 2.6%. The consensus forecast for ’11 from the 50 leading economic forecasting groups surveyed by Blue Chip has lost half a point since January.

More significant for foodservice, the ’11 forecast for real disposable personal income growth sank to 1.8% in the June survey, from 2.4% in May. A big part of the decline was a result of a dramatic decline in the government’s estimate of first quarter DPI; originally pegged at 2.9%, it was revised down to just 0.8%. The estimate of fourth quarter ’10 DPI growth also was reduced.

Still, most of the Blue Chip economists see the drags on growth as temporary, a result of the jumps in gas and food prices, the effects of the Japanese tsunami and the like. The consensus predicts growth will pick up again this summer, though a modest and bumpy recovery is still the outlook.

While annualized quarterly real GDP growth was 1.8% in the first quarter and is forecast at 2.6% in the second, the forecasts for the third and fourth quarter remain at 3.3% and 3.4% respectively. These are close to the Blue Chip forecasts in the March survey. The quarterly forecasts for real DPI and personal consumption expenditure growth are somewhat lower than in March, but not dramatically so.

And the consensus forecasts for ’12 have not changed much. The June GDP forecast is for 3.1% growth next year, down from 3.2% in the January survey. The ’12 forecast for DPI growth is down only 0.1 point at 2.3% and PCE remains at 2.8%. These aren’t barn-burner growth rates, but they are growth and not declines.

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