Fed to wait until 2023 to raise rates, but there is risk of earlier hike – Reuters Poll
“The Federal Reserve will wait until 2023 before raising interest rates,” per the October 12-18 Reuters poll economists. The survey results also mention “persistently higher inflation over the coming year” as a greater risk for the US economy.
Key quotes
Forty of 67 economists said the fed funds rate would rise from its current level of 0-0.25% in 2023 or later, with most clustering around the first quarter of that year. The remaining 27 economists expect a rate hike by the end of next year.
Twenty-nine of the 37 economists who responded said the risk for the timing of the Fed's first interest rate hike was that it could come earlier than they expected.
Twenty-two of the 40 economists who responded to an additional question said the greater worry for the U.S. economy over the coming year was persistently higher inflation, and 30% of them said it was a bigger-than-expected slowdown in growth.
On average, the economy was expected to grow 4.0% next year, 2.5% in 2023 and 2.2% in 2024. That compared with previous forecasts of 4.2% for 2022 and 2.3% for 2023. The September poll did not ask for forecasts for 2024.
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