According to a survey by the Federal Reserve Bank of Philadelphia, the U.S. economic outlook has improved slightly compared to three months ago:

  • Forecasters predict a 1.3 percent annual growth rate for this quarter, up from the previous estimate of 1.2 percent.
  • For 2023, they expect real GDP to increase by 2.4 percent, and by 1.7 percent in 2024, which is 0.3 and 0.4 percentage points higher than earlier estimates.
  • The unemployment rate is expected to rise from 3.7 percent in 2023 to 4.0 percent in 2026, with little change from the previous survey.
  • Job gains are projected to be higher, with monthly rates of 296,500 in 2023 and 120,000 in 2024, up from earlier estimates of 288,600 and 94,800, respectively.

Forecasters anticipate changes in inflation rates as follows:

  • The current-quarter headline CPI inflation is expected to average 3.3 percent at an annual rate, up from the previous estimate of 2.9 percent.
  • Headline PCE inflation for the current quarter is also projected to be slightly higher at an annual rate of 2.9 percent.
  • However, the predictions for current-quarter core CPI and core PCE inflation are lower compared to previous estimates.
  • Projections for inflation in 2024 and 2025 remain largely unchanged from previous estimates.

Over the next decade (2023 to 2032):

  • Headline CPI inflation is expected to average 2.40 percent annually, which is consistent with the previous estimate.
  • The corresponding estimate for 10-year annual-average PCE inflation is 2.22 percent, slightly higher than the previous survey's estimate.