ECONOMIC FORECAST PROBABILITIES
In addition to their regular forecasts for the major economic indicators, each January we survey our panelists for their predictions of how the various economies are most likely to perform over a given time horizon. We undertake special surveys of economic forecast probabilities across our publications Consensus Forecasts, Asia Pacific Consensus Forecasts and Eastern Europe Consensus Forecasts.
This special survey aims to assess the risk of these other 'non-consensus' outcomes, which range wider than a simple examination of the highest and lowest central forecasts would suggest. In order to do this we asked our panelists to assess the probability that the variables covered would fall within the ranges displayed in the partial sample tables below, which allowed us to compile some rough probability distributions to identify those areas of greatest uncertainty in the economic outlook. The ranges themselves differ from country to country and from variable to variable, but were set so that the central range (the middle column in the tables and charts) encompassed the consensus forecast from last month's survey. The width of all of the ranges was chosen to reflect the standard deviation of central forecasts for each variable. The ranges are wider for those variables for which the economic outlook is most uncertain.
| Consensus Forecasts | Asia Pacific Consensus Forecasts | Eastern Europe Consensus Forecasts |
|---|---|---|
| United States | Australia | Czech Republic |
| Japan | China | Hungary |
| Germany | Hong Kong | Poland |
| France | India | Russia |
| United Kingdom | Indonesia | Turkey |
| Italy | Japan | Bulgaria |
| Canada | Malaysia | Croatia |
| Euro zone | New Zealand | Estonia |
| Philippines | Latvia | |
| Singapore | Lithuania | |
| South Korea | Romania | |
| Taiwan | Slovakia | |
| Thailand | Slovenia | |
| Ukraine |
Download Sample Issues
The table below shows a small portion of the data from one of our surveys of economic forecast probabilities (from our January 2011 Consensus Forecasts survey).
UNITED STATES |
|||||||
|
GDP Growth, % |
< +0.6 1 |
+0.6 to +1.3 1 |
+1.4 to +2.1 7 |
+2.2 to +2.9 30 |
+3.0 to +3.7 44 |
+3.8 to +4.5 15 |
> +4.5 3 |
| Consumer
Price Inflation 2011 consensus = +1.7% % probability |
< +0.1 1 |
+0.1 to |
+1.4 to +2.1 30 |
+2.2 to +2.9 43 |
+3.0 to +3.7 16 |
+3.8 to +4.5 4 |
> +4.5 0 |
| Current
Account, US$bn |
< -898 0 |
-898 to -768 1 |
-767 to |
-636 to -506 48 |
-505 to -375 29 |
-374 to -244 7 |
> -244 0 |
Last year was a period of transition for the United States
as observers waited to see if the recovery following the 2009 recession
would become more entrenched. Recently, our US panel has become significantly
more upbeat about 2011 activity, with growth of 3.2% now expected, outstripping
last year’s estimated 2.9% pace. As the chart below shows, confidence
is skewed heavily to the upside with respondents increasingly willing to
envisage a stronger growth outturn. Having said that, a number of factors
weigh on the GDP outlook. Production indicators are firm and external demand
still buoyant, but a sluggish rebound in the job market – coupled
with still-constrained borrowing conditions and a housing sector in depression
– remains in play. In light of the sovereign crises plaguing debt-ridden
parts of Western Europe, the Federal deficit's massive overhang could be
seen as a warning going forward if growth does not take off of its own accord.
A portion of the text from Consensus Forecasts, January 10, 2011