National Association for Business Economics (03/25/14)

Annual average gross domestic product growth in 2014 is expected to be stronger than projected in December’s survey by the National Association for Business Economics, the group says. GDP of 2.8% is forecast compared with the 2.5% forecast in December. This is despite the median view that unusually severe winter weather will subtract 0.4 percentage points from annualized real GDP growth in the first quarter of the year. On a quarterly basis, the survey respondents expect real GDP growth to rise steadily from a 1.9% annualized rate in the first quarter of 2014 to 3.2% in the third quarter of 2015.

Further labor market recovery is anticipated. Nonfarm payrolls are expected to post an average monthly gain of 188,000 for all of 2014, slightly below the 194,000 recorded last year. Survey respondents anticipate stronger job creation of 205,000 per month in 2015. The unemployment rate is expected to average 6.4% in 2014, down a full percentage point from 2013, and decline to 6.1% in 2015.