NABE Outlook Survey - June 2020

NABE Panel Expects GDP to Fall 5.6% in 2020, With Risks to the Outlook Still Heavily Skewed to the Downside

The June 2020 NABE Outlook presents the consensus macroeconomic forecast of a panel of 48 professional forecasters (see last page for listing). The survey, covering the outlook for 2020 and 2021, was conducted May 14–26, 2020. The NABE Outlook Survey originated in 1965, and is one of three surveys conducted by the National Association for Business Economics (NABE); the others are the NABE Business Conditions Survey and the NABE Economic Policy Survey. Founded in 1959, the National Association for Business Economics is the professional association for those who use economics in their work. NABE has over 2,900 members and 44 chapters nationwide. Eugenio Aleman, Wells Fargo Bank, Survey Chair; Jan Hogrefe, Boeing; Jack Kleinhenz, CBE, National Retail Federation; Sara Rutledge, Real Estate Economics Consultant; Yelena Shulyatyeva, Bloomberg LP; and Ryan Sweet, Moody’s Analytics, conducted the analysis of survey responses for this report. The views expressed in this report are those of the panelists, and do not necessarily represent the views of their affiliated companies or institutions. This report may be reproduced in whole or in part with appropriate citation to NABE. 

SUMMARY: “NABE Outlook Survey panelists expect a 5.6% decline in inflation-adjusted gross domestic product from the fourth quarter of 2019 to the fourth quarter of 2020,” said NABE President Constance Hunter, CBE, chief economist, KPMG. “Panelists expect the largest decline, 33.5%, annualized, quarter-over-quarter, in the second quarter of the year. These decreases reflect the impact of the COVID-19 pandemic.”

“The NABE panel remains decidedly pessimistic about the second quarter of the year, as 80% of participants view risks to the outlook tilted to the downside,” added Outlook Survey Chair Eugenio Aleman, economist, Wells Fargo Bank. “Furthermore, 87% of panelists view a second wave of COVID-19 as the greatest downside risk through 2020. Meanwhile, 51% of panelists believe that ‘a vaccine’ is the greatest upside risk for 2020, while 29% of respondents believe that the greatest upside risk is a ‘test and trace policy’ that would slow the COVID-19 outbreak, and allow a broader reopening of the economy. A large majority of panelists—84%—believes that companies will reduce their ‘dependence on global supply chains.’ All panelists indicate that the Federal Reserve will not ‘implement a policy of negative interest rates due to COVID-19.’”