(TNND) \u2014 Bankrate’s quarterly survey of economists pegged the odds of a recession in the next year at 34%.<\/p>\n
The 18 economists polled by Bankrate also expected<\/a> slightly worse job growth and slightly higher unemployment than they expected in the previous quarter. They foresaw modest declines in mortgage rates and the Treasury yield. And they didn’t see inflation coming down to the Federal Reserve’s target until at least next year.<\/p>\n Bankrate senior economic analyst Mark Hamrick said a lot of Americans don\u2019t feel like the economy is working very well for them these days, but there were no loud alarm bells in the survey results from the economists.<\/p>\n \u201cI think that this collective consensus among the economists is consistent with a remarkably resilient U.S. economy,\u201d Hamrick said.<\/p>\n The survey was fielded March 23 through April 1, well after the war in Iran sent gas prices rising.<\/p>\n \u201cHigher for longer is probably one of the more confident forecasts we can make about interest rates and inflation, and they’re both joined at the hip,\u201d Hamrick said.<\/p>\n Just 6% of the surveyed economists expected the U.S. to see the Fed\u2019s target rate for inflation, 2%, by the end of the year. Nearly half don\u2019t expect the 2% inflation target to be hit until at least 2028.<\/p>\n The latest consumer price index, a popular measure of inflation, showed an annual rate of 3.3%, following the biggest monthly inflation spike in four years<\/a>.<\/p>\n Hamrick said Americans are dealing with persistent inflation and major uncertainties.<\/p>\n And he said the uncertainties were reflected in the wide range of labor market predictions offered by the economists.<\/p>\n On average, the economists expect monthly job growth of about 41,000, down from the monthly prediction of about 64,000 they gave for the previous quarter.<\/p>\n But Hamrick said forecasts from the economists in the new, first-quarter survey ranged from small monthly contractions to growth of 100,000-plus jobs a month.<\/p>\n Likewise, the average forecast for the unemployment rate a year from now came in at 4.6%. That was worse than the 4.5% consensus prediction in the previous quarter, but it also came from a wide range of forecasts (4.2% to 5%).<\/p>\n Hamrick talked about the so-called K-shaped economy, where lower-income people are disproportionately hurt by inflation while high-income households fare better.<\/p>\n And other recent reports have pointed to a middle-class, not just lower-income households, that\u2019s increasingly finding it harder to keep pace<\/a>.<\/p>\n Hamrick said business is doing better in \u201cthe front of the airplane,\u201d meaning folks who can afford to pay first-class, or higher prices elsewhere, aren\u2019t feeling the pain as much as everyday Americans.<\/p>\n \u201cThere’s essentially a vibe oppression going on,\u201d Hamrick said.<\/p>\n While there\u2019s not a depression economically, and the macroeconomic data isn\u2019t so bad, people aren’t wrong to say that the economy as it relates to them is \u201csuboptimal,\u201d Hamrick said.<\/p>\n Hamrick said it\u2019s meaningful when the University of Michigan\u2019s long-running consumer survey reports record-low sentiment<\/a>.<\/p>\n \u201cNow, is it meaningful about future economic activity? We’ll see,\u201d he said.<\/p>\n The likelihood of a recession in the next year is 34%, according to the economists surveyed by Bankrate.<\/p>\n Hamrick said Americans need to acknowledge that there is a risk of a recession, but that it doesn\u2019t appear likely.<\/p>\n The recession odds jumped from 28% in the previous quarter. But the 34% odds now are still lower than most quarters over the last four years.<\/p>\n Bankrate has been surveying economists every quarter for a decade.<\/p>\n This time, economists expected the average 30-year fixed-rate mortgage, currently 6.3%<\/a>, to fall to 6.05% by the end of the year.<\/p>\n And they expected the 10-year Treasury yield to modestly decline over the next 12 months to 4.19%.<\/p>\n