Yet again in 2015 the consensus forecast for real GDP growth was too optimistic. Economists at the end of 2014 were expecting growth of 3.2% for the following year against what is now expected to be the actual figure of just 2.5%. Economists have only precisely nailed GDP growth once in the last 15 years (in 2012); they underestimated it once (in 2002) and have overestimated it by a median of 0.6 percentage points every other time throughout this entire period. In this week's Economics Weekly we examine the current economic outlook, specifically for the U.S. consumer, who is the key to this year's performance. We believe that we are looking at another positive growth year, but that rate will be fairly mediocre, with risks unfortunately still tilted toward the downside.
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Richard de Chazal, CFA is a London-based macroeconomist covering the U.S. economy and financial markets.