A person shops at a supermarket in New York City on December 14, 2022.
Yuki Iwamura | AFP | Getty Images
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The bottom line
Forecasters are getting increasingly upbeat about the state of the U.S. economy.
Last year, many economists predicted a recession but that never happened. Now, a growing chorus of analysts are sanguine about growth this year.
In its latest survey, the National Association for Business Economics “sharply revised upwards” its GDP forecast for 2024. NABE now expects the economy to grow by 2.2%, compared with the 1.3% it forecast in December.
“The stronger February growth forecasts for 2024 result from upward revisions to key sectors of the economy,” including consumer spending, said Ellen Zentner, chief economist at Morgan Stanley and NABE president.
Other experts share the optimism.
Bank of America’s annual survey of Merrill financial advisors indicated a significant decline in recessionary fears and an uptick in bullish sentiment.
Strategist Savita Subramanian wrote in a Friday note, just 4% of the survey’s 240 respondents expect a recession this year, compared with 85% of the respondents last year.
U.S. consumer spending and jobs growth has been holding up remarkably well despite higher borrowing costs and persistent inflation.
Still, the NABE noted 41% of respondents cited high rates as the most significant risk to the economy.
Investors have reset their expectations for rate cuts this year, given the Fed’s cautious tone on lowering rates. Earlier in the year, many had expected an aggressive series of rate cuts starting in March, they now see policy easing not beginning until June or July.
Markets are bracing for more key data slated for release in the coming days that will shed further insight into the health of the economy and the lingering inflation threat.
â CNBC’s Jeff Cox contributed to this report
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