The July 2021 Wall Street Journal Economic Forecast Survey

The July 2021 Wall Street Journal Economic Forecast Survey was published on July 11, 2021. The headline is “Higher Inflation Is Here to Stay for Years, Economists Forecast.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the forecasts section.

An excerpt:

Americans should brace themselves for several years of higher inflation than they’ve seen in decades, according to economists who expect the robust post-pandemic economic recovery to fuel brisk price increases for a while.

As seen in the “Recession Probability” section, the average response as to whether the economy will be in a recession within the next 12 months was 11.56%. The individual estimates, of those who responded, ranged from 0% to 40%.  For reference, the average response in April’s survey [the last survey published] was 12.53%.

As stated in the article, the survey’s 64 respondents were academic, financial and business economists.  The survey was conducted July 2 – July 7. Not every economist answered every question.

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Economic Forecasts

The current average forecasts among economists polled include the following:

GDP:

full-year 2021:  6.89%

full-year 2022:  3.24%

full-year 2023:  2.30%

Unemployment Rate:

December 2021: 4.89%

December 2022: 4.12%

December 2023: 3.80%

10-Year Treasury Yield:

December 2021: 1.79%

December 2022: 2.11%

December 2023: 2.41%

CPI:

December 2021:  4.11%

December 2022:  2.50%

December 2023:  2.45%

Core PCE:

full-year 2021:  3.21%

full-year 2022:  2.29%

full-year 2023:  2.24%

(note: I have highlighted this WSJ Economic Forecast survey each time it is published; it was published monthly until April 2021, after which the survey is conducted every three months; 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 4369.55 as this post is written