NEW YORK (Reuters) – Economists downgraded their expectations for when the Federal Reserve will cut interest rates and raised their forecasts for inflation and labor market strength, according to a poll published on Monday.
A survey of economists now believes the US central bank, which has been arguing whether it needs to raise rates again, will raise benchmark interest rates in the first quarter of next year, according to a survey published by the National Association for Business Economics (NABE). will reduce , ,
In February, respondents expected the Fed to cut rates in the last three months of this year. Economists stood by their view on the Fed’s benchmark overnight interest rate cap, which is in line with the central bank’s current target range of 5% to 5.25%.
The NABE survey showed that respondents were divided on whether the US economy would enter a recession, although the survey’s median opinion sees a modest level of growth through 2024, the fourth quarter of 2022 and the last three months. With an expected increase of 0.4% between of 2023.
Respondents raised their forecast for inflation in 2023, with the consumer price index projected to rise 3.3% between the last quarter of 2022 and the last quarter of 2023, according to the survey. In February, respondents predicted that inflation would increase by 3% over the same period.
The survey also improved the outlook for the labor market, with respondents expecting an average of 142,000 jobs in the month, up from 102,000 in the February survey. The unemployment rate, currently at 3.4%, is expected to average 3.7% this year, up from 3.9% in the February survey.