The latest Bloomberg consensus on US GDP, which was released on 9 June, has not changed much relative to May. The consensus expectation for US GDP growth in 2010 is currently 3.2%. This estimate has been consistently revised up since mid-2009 (see chart attached), moving from a low of 1.8% in June 2009 to the current 3.2%. Given the more recent economic data, I would expect that the consensus estimate for 2010 may be revised down slightly in July.
The consensus GDP growth forecast for 2011 is currently 2.9%, suggesting that the median economist expects the US economy to slow in 2011 relative to 2010, but certainly avoid a double-dip recession. Once again, it is likely that this estimate will be revised slightly lower when the data is published for July. The US employment data out this afternoon is probably the key factor impacting any change in forecast in the short-term.
Lastly, it is worthwhile mentioning that even though we are half-way through the year (okay that is stating the obvious), there is still a wide dispersion of GDP forecasts for 2010 and 2011 suggesting that there is still an especially high degree of uncertainty about the outlook for the economy over the next 18 months. There are 65 economists that contribute to the consensus forecast. The high estimate for 2010 is 3.8% and the low is 2.6%, while the high estimate for 2011 is 5.2% and the low is 1.6%. The current dispersion of views for 2011 is significant and should reflect in ongoing market volatility, but still remain range bound, until the dispersion of views for 2011 narrows meaningfully. Unsurprisingly, the dispersion of views for 2011 has increased meaningfully (by more than a full 1%) since the beginning of 2010, and more especially in the past two months. Interestingly, the dispersion for 2012 is currently even worse (high of 6.0% and low of 1.2%).
Download the chart here