US Economic Survey, End-Year 2019

The SIFMA Economic Advisory Roundtable brings together Chief U.S. Economists of over 20 global and regional financial institutions. The twice-annual U.S. Economic Survey compiles economic forecasts from roundtable members, published prior to the upcoming Federal Open Market Committee (FOMC) meeting. This report analyzes economists’ expectations for: GDP growth, unemployment rate, inflation rate, interest rates, etc. It also reviews expectations for policy moves at the upcoming FOMC meeting, as well as discussing key macroeconomic topics and how these factors could impact monetary policy.

Compared with the June survey, the economists surveyed increased their GDP growth estimates for 2019 by 0.05% to a median forecast of 2.2%, on a fourth quarter over fourth quarter basis. For 2020, the median forecast was lowered by 0.1% to 1.8%, on a fourth quarter over fourth quarter basis.

“Despite the markdown in 2020 GDP growth, the economy is still expected to expand at a moderate pace,” said Ellen Zentner, a Managing Director and Chief U.S. Economist for Morgan Stanley, and chair of SIFMA’s Economic Advisory Roundtable. “U.S. trade policy, business confidence in the U.S., and private credit market conditions were among the most important considerations in the forecast change. When gauging risks to the outlook, it is of no surprise that trade, global growth and U.S. political uncertainty appeared among the top risks – both to the up and downside.” The 12-month probability of recession remained the same at 25% but decreased slightly to 40.0% over the next 24 months.

The Economy

Economists expect real personal consumption growth to come in at 2.6% at the end of 2019, then soften to its longer-run trend around 2.1% in 2020. This is despite an expected increase in average hourly earnings to 3.1% in 2019 and 3.2% in 2020, which implies a rising rate of saving.

On the labor side, economists expect the unemployment rate to tick up slightly to 3.7% in 2020, after an expected 0.2% decline in 2019 to 3.6%. Employment growth (average monthly change in non-farm payroll employment) is expected to slow further in 2020 to 139,000, after an expected decline to 163,000 in 2019 from 223,000 in 2018.

In terms of inflation, as measured by the PCE deflator, analysts expect it to increase to 2.1% in 2020 from an expected 1.5% to end 2019 (2.2% from 1.7% for core PCE deflator).

Monetary Policy

50% of respondents believe the Fed’s next rates move will be up; 44% down, and 6% see the Fed on hold for the foreseeable future. This differs from 65% down and 35% up in our mid-year survey and reflects increased optimism among economists. If the next move is up, respondents expect the Fed will move after 2020 (88%). If the next move is down, 43% of respondents expect the Fed will move in 2Q20, followed by 29% of responses for both 1Q20 and 4Q19. Respondents believe the Fed’s terminal rate in this cycle will be 2.1%, which is down from 2.4% for our mid-year survey.

Similar to our mid-year survey, inflation considerations ranked highest among factors in the Fed’s decision to raise rates, followed by labor market conditions. Labor market conditions were also at the top of the list of the most important decisions for the Fed to cut rates, followed by global economic developments and inflation considerations.

Interest Rates and Credit Markets

Respondents expect little movement in key rates, with Fed Funds falling to 1.625% through 1Q20 and further to 1.620% by 4Q20. 2-Year UST is forecasted to fluctuate in 2019 and 2020 between 1.563% and 1.600%, while 10-Year UST is expected to climb from 1.715% in 2Q20 to 1.850% in 4Q20. Finally, respondents expect the 30-Year Mortgage to climb from 3.655% in 1Q20 to 3.775% in 4Q20.

Respondents also gave expectations for various yield spreads, including 70% expecting the yield curve to steepen; 60% expecting the TED spread to remain about the same; 50% expecting the spread of IG corporates bonds to U.S. Treasury to widen; and 69% expecting the spread of HY corporates bonds to U.S. Treasury to widen.

Tariffs on Products from China (and Elsewhere)

50% of respondents believe tariffs on products from China (and elsewhere) have impacted 2019 GDP growth by 0-20 bps (80% in the mid-year survey), followed by 43% building in lower GDP growth by greater than 20 bps. As to the impact on prices, 71% of respondents believe tariffs will have raised prices by 0-20 bps (69% in the mid-year survey), followed by 21% responding no impact.


Ellen Zentner, Managing Director and Chief U.S. Economist for Morgan Stanley and Chair of SIFMA’s Economic Advisory Roundtable, discusses key findings from the end-year 2019 survey.

Full Report

Continue reading for all survey results, more charts and a reference guide on the U.S. economic landscape.




  • Katie Kolchin, CFA
  • Justyna Podziemska
  • Ali Mostafa

SIFMA Economic Advisory Roundtable Chair

  • Ellen Zentner, Morgan Stanley & Co., Inc.

SIFMA Economic Advisory Roundtable

  • Ethan Harris, Bank of America-Merrill Lynch
  • Michael Gapen, Barclays Capital Inc.
  • Nathaniel Karp, BBVA Compass
  • Douglas Porter, BMO Financial Group
  • Andrew Hollenhorst, Citigroup
  • Michael Carey, Credit Agricole
  • James Sweeney, Credit Suisse AG
  • Michael Moran, Daiwa Capital Markets America, Inc.
  • Peter Hooper, Deutsche Bank Securities Inc.
  • Christopher Low, FTN Financial
  • Jan Hatzius, Goldman Sachs & Co.
  • Ward McCarthy, Jefferies & Co., Inc.
  • Michael Feroli, J.P. Morgan Chase & Co.
  • John Lonski, Moody’s Analytics, Inc.
  • Joseph LeVorgna, Natixis
  • Michelle Girard, NatWest Markets Securities, Inc.
  • Lewis Alexander, Nomura Securities International, Inc.
  • Carl Tannenbaum, Northern Trust
  • Augustine Faucher, PNC Financial Group
  • Scott J. Brown, Raymond James & Associates, Inc.
  • Tom Porcelli, RBC Capital Markets, Inc.
  • Stephen Gallagher, Societe Generale Corporate and Investment Banking
  • Lindsey Piegza, Stifel Financial Corp.
  • Seth Carpenter, UBS Investment Bank
  • Jay Bryson, Wells Fargo Securities, LLC