2023 q4/q4 growth is relatively unchanged. Modal guess for recession start date moved to 2024Q1-Q2 (survey results here; FT article).

Figure 1: GDP (bold black), Survey of Professional Forecasters May median (blue), FT-Booth School June median (red square), FT-Booth School high/low (gray +), GDPNow of 6/8 (sky blue square), potential GDP (bold gray) all in billions Ch.2012$ SAAR. Source: BEA 2023Q1 2nd release, FT-IGM (June 2023), Philadelphia Fed, Atlanta Fed, CBO (February 2023), and author’s calculations. 

The survey median was slightly higher than my response (+0.9% for 2023 q4/q4), while I was considerably more pessimistic with respect to downside and upside risks (my low/high range was -1.0% and +2.0%, vs. survey +0.5 to +2.2%).

My estimate was for recession in 2023Q3-Q4 (same as my March guess). The current modal response is 2024Q1-Q2, moving back from the previous modal response of 2023Q3-Q4.

Source: FT-Booth School survey, June 2023.

The pushing back of the recession start date is unsurprising given the incoming data, where nowcasts have exceeded early May forecasts, and the resolution of debt ceiling uncertainty.

Note that end-2023 is consistent with term spread models (using a 50% threshold), as discussed in this post.

Given this guess for the beginning of the recession, it’s not too surprising what survey respondents think is the timing of peak Fed funds and beginning of reductions (2023Q3 for the former, 2024Q1-2024Q2 for the latter). It’s interesting to think that we’re less than three weeks away from Q3.

Respondents believe that peak Fed funds will be between 5.5%-6%, which matches my view (and is consistent with market-implied forecasts [Atlanta Fed probability tracker, accessed 6/12/2023]).

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