At the 16th annual Automotive Outlook Symposium sponsored by the Chicago Federal Reserve, the following median economic forecast of participants was presented:
"The nation’s economic growth in 2009 will be substantially slower than in 2008, inflation will turn negative (because of lower energy prices and the large amount of slack in the economy), and the unemployment rate will rise substantially. Real GDP, after having fallen 0.8% last year, is forecasted to decrease 1.8% this year and then rise to an above-trend rate of 3.2% in 2010. After rising 1.5% last year, inflation, as measured by the Consumer Price Index, is expected decline 0.5% this year and then rise at a moderate pace of 1.6% in 2010. The unemployment rate, after having averaged 6.9% in the fourth quarter of 2008, is forecasted to peak at 9.9% in the final quarter of 2009 and then edge down to 9.5% by the end of 2010.
"Most of the major components of real GDP – particularly business fixed investment – are expected to contribute to the forecast for slow economic growth in 2009. Economic growth is forecasted to improve in 2010, in large part because of an expansion in spending in residential investment. Industrial production is forecasted to decline at a fast pace in 2009 and then increase at a much faster rate than the overall economy in 2010.
"Net exports are predicted to improve in 2009 and edge down in 2010. Car and light truck sales are projected to be very weak in 2009, with sales at 9.7 million units – the slowest selling rate in more than 40 years; and they are expected to improve to 11.3 million units in 2010 – the slowest rate since 1982. Interest rates (one- and ten-year Treasury rates) are anticipated to fall this year and then rise next year. Oil prices are expected average $56 per barrel by the end of 2009 and then rise to just over $65 per barrel at the end of 2010. The trade-weighted U.S. dollar is expected to rise both this year and next."
