The March 2020 Wall Street Journal Economic Forecast Survey

The March 2020 Wall Street Journal Economic Forecast Survey was published on March 12, 2020.  The headline is “WSJ Survey: Coronavirus to Trigger U.S. Economic Contraction in Second Quarter.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the “Economist Q&A” section.

An excerpt:

Business and academic economists in the survey now expect, on average, gross domestic product to contract 0.1% at an annual rate in the second quarter. That is a large downgrade from February, when they still expected GDP growth of 1.9% from April to June.

The monthly survey of economists found 75% of economists expect the coronavirus spread to be a “significant drag” on full-year economic growth in 2020, shaving more than 0.5 percentage point from growth as measured from the fourth quarter of the prior year.

As seen in the “Recession Probability” section, the average response as to the odds of another recession starting within the next 12 months was 48.8%. The individual estimates, of those who responded, ranged from 20% to 100%.  For reference, the average response in February’s survey was 25.6%.

As stated in the article, the survey’s 55 respondents were academic, financial and business economists.  Not every economist answered every question.  The survey was conducted March 6 – March 10, 2020.

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Economic Forecasts

The current average forecasts among economists polled include the following:

GDP:

full-year 2020:  1.16%

full-year 2021:  2.09%

full-year 2022:  2.03%

Unemployment Rate:

December 2020: 3.90%

December 2021: 3.91%

December 2022: 3.93%

10-Year Treasury Yield:

December 2020: 1.19%

December 2021: 1.68%

December 2022: 2.04%

CPI:

December 2020:  1.60%

December 2021:  2.10%

December 2022:  2.11%

Crude Oil  ($ per bbl):

for 12/31/2020: $43.33

for 12/31/2021: $51.09

for 12/31/2022: $53.37

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” label)

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I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not necessarily agree with many of the consensus estimates and much of the commentary in these forecast surveys.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 2563.30 as this post is written