Updated Vining Sparks Economic and Interest Rate Projections (and Bloomberg Survey of Economists)
by Craig Dismuke, Dudley Carter
June 2019 Update
Attached are our updated economic and interest rate projections. Because trade negotiations have been unresolved for longer than expected and inflation has proven weaker than expected, we have lowered our interest rate projections for 2019. We now expect the Fed to cut rates by up to 50 basis points this year followed by an attempt to raise rates again in 2020. While everything hinges on the resolution of U.S. – China trade talks, we do not believe the economy is currently on the cusp of a recession, as indicated by some financial indicators. Rather, we see softer-than-target inflation giving the Fed room to ease policy and extend the longest economic expansion on record.