Foodservice Equipment Reports

Long-Term U.S. Economic Forecasts Decline Slightly

Because the short-term economic outlook is so dicey, what with the federal government partial shutdown and the looming debt-ceiling deadline, we might want to focus on the longer term. Blue Chip Economic Indicators released its latest long-term consensus projections in early October. Most of the important numbers have deteriorated slightly from the forecasts last March. These are important because we base FER’s long-term E&S market forecasts, in part, on the Blue Chip numbers.

Forecasts for real GDP growth fell for 2015 through 2018. GDP growth for ’15 is now forecast at 2.9% vs. 3.1% in the March survey. Forecasts for GDP growth in ’16, ’17 and ’18 were down 0.1 point each, to 2.8%, 2.7% and 2.6%.

The foodservice critical disposable personal income and personal consumption expenditures forecasts also were lower, but not as consistently. The real DPI forecasts for ’15 and ’16 were down 0.1 point to 2.9% and 2.8% but held steady for the following years. Real PCE forecasts remained at 2.7% for ’15, fell 0.1 point in ’16 and remained steady in ’17.

On the positive side, unemployment forecasts are better by 0.2 point for every year ’15 to ’17 and inflation forecasts remain muted with the Consumer Price Index forecasts at 2.2% for ’15 and 2.3% for ’16.

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