The Federal Reserve updates its economic outlook every quarter, based on the individual forecasts of Fed board members and the presidents of the Fed’s 12 regional banks. The latest projections on Sept. 18 show only modest changes from the Fed’s June outlook. GDP growth is expected to slow significantly from last year’s 3% rise, an advance that was fueled by President Donald Trump’s tax cuts. Inflation remains benign, and unemployment edges up only slightly. The Fed does not expect a recession.
The Fed outlook is in line with most private economists. However, it differs sharply from the Trump administration in terms of GDP growth. The administration sees GDP hitting 3.2% this year and staying near 3% over the next decade. The Fed forecast, which only extends out to 2022, sees much slower growth based on a belief that GDP will be held back by slower growth in the labor force and modest productivity gains. Here are Fed and administration forecasts for GDP and Fed forecasts for unemployment and inflation.