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| The US will avoid a recession next year. (Source: 123RF) |
From December 28, 2023 to January 9, 2024, NABE conducted a survey of 57 economists.
About 91% of respondents said the probability of the US entering a recession in the next 12 months was 50% or less, a far cry from the view a year ago, when economists predicted the US Federal Reserve would raise interest rates to combat high inflation.
The upbeat sentiment in the NABE survey matches recent economic data, including a gauge of consumer confidence that rose to a two-and-a-half-year high.
At the same time, inflation has fallen faster than expected and the labor market is cooling but not too quickly.
Fed policymakers have signaled they are likely to cut interest rates this year if inflation continues to fall.
The bank has maintained interest rates in the range of 5.25-5.5% since July 2023.
Economists surveyed by NABE expect corporate revenue and profit margins to increase in 2024. At the same time, supply chain issues and labor shortages are easing, which could be positive news for the inflation outlook.
About 63% of respondents in the latest survey said there was no shortage of production materials, up from 46% three months earlier, and just over 50% said there was no shortage of labor, up from 38% previously.
According to NABE, both issues are in the best state since the Covid-19 pandemic broke out.
Meanwhile, Goldman Sachs bank forecasts that the US economic growth in 2024 will be 2.3%. Meanwhile, Citigroup forecasts that the world's number 1 economy will only grow by 1.1%.
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