March 11, 2016—Try making an accurate economic forecast for 2017 when the U.S. president could be anyone from Bernie Sanders to Donald Trump.
Just as the 2016 race has stymied political prognosticators, it is also confounding economists. More than three-fourths of forecasters in a new Wall Street Journal survey say the presidential election has introduced more uncertainty than is typical from a change at the White House.
Markets rebounded over the past month as economic reports bolstered the case that continued—though moderate—economic growth seems likely. The average survey respondent estimates the economy will grow about 2.4 percent this year and next, and that the unemployment rate will fall to 4.6 percent in 2017. A new president promising dramatic and immediate changes could quickly upend that.
“It’s stunning to me the markets aren’t more worried about it,” said Diane Swonk, founder of DS Economics, an economic risk-management firm. The rhetoric on the campaign trail is full of “pretty startling stuff—isolationism, nationalism, reduced trade flows. We know what that does economically."
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