Analysts expect to see a stronger U.S. labor market amid more inflation than they did three months ago and pushed back their views of when the economy will potentially slow to the fourth quarter, according to a Federal Reserve Bank of Philadelphia survey released Friday.
The Philly Fed’s quarterly Survey of Professional Forecasters predicted growth to slow from 1.3% growth in 2023 to 1.0% in 2024 before picking up again to over 2%. The 38 forecasters surveyed also revised upward their growth expectations for Q3 and revised downward their Q4 estimates to flat.
The forecasters see stronger payroll employment growth in 2023 than they did three months ago, penciling in a monthly rate of 257,500 in 2023, up from 217,800 previously. The median estimate sees payrolls slowing to about 26,000 in Q4, before picking up to 37,000 in the first quarter next year with an annual average of 56,000 in 2024.
Near-term expectations for inflation were revised higher as well. The median forecasters sees Q4 core PCE at 2.9%, up from 2.5% previously.
Source: Philly Fed’s Survey of Professional Forecasters
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