Macroeconomic Forecasts Improve A Bit

As we get closer to the end of the year, we like to keep an even closer eye on the macroeconomic forecasts for the U.S. and major economies worldwide. We are always watching them, but just don’t always report them, figuring most of you pay attention anyway.

Blue Chip Economic Indicators reports in its November newsletter that the consensus forecasts from 50 major forecasting groups for real growth of gross domestic product in the United States rose 0.1 point for both 2011 and ’12. Not that the new numbers are anything to get too excited about: still a meager 1.8% for ’11 and an only slightly better 2.1% for ’12. The forecast for growth in real disposable personal income actually fell 0.2 point for both years, to 1.3% for’11 and 1.4% for ’12. The forecasts for real growth in personal consumption expenditures rose 0.1 point each year to 2.2% and 2.0%. It appears that consumers are getting tired and beginning to spend more even though their incomes are basically stagnant. Maybe they’ve paid off of most of their debts.

On another positive note (we’re being a bit sarcastic here if you haven’t noticed), only one in four of the Blue Chip economists believe we’ll fall into recession again by the end of ’12, compared with one in three in the October survey.

On the other hand, the consensus forecasts real GDP growth of only 0.5% for the Eurozone next year, down from 0.8% last month and Blue Chip said “an increasing minority of analysts now assume a mild recession may occur.” Ain’t balance-sheet recessions fun? Yikes! The Asian economies are still forecast to grow robustly, thank goodness. Have a happy Thanksgiving.