Parity in Expected Growth

July 8, 2008

The latest monthly survey of forecasters by The Economist produced an identical consensus 2009 growth expectation of 1.3% for the United States, euro area and Japan.  I cannot recall a previous time when expected growth was exactly the same for each of these economies.  All of these forecasts were revised downward from the prior monthly poll taken in June.  In the July 2007 survey, expected 2008 growth had been penciled in at 2.3% for both Japan and Euroland but 2.7% in the U.S. case.  One year later in the most recent survey, expected growth in 2008 has been scaled back to 1.4% in Japan and the United States and to 1.7% in Euroland.  It would probably surprise many market participants to learn that the latest actual on-year growth rates for the big-three put the United States on top with 2.5% as of 1Q08, followed by growth of 2.2% in Euroland and 1.3% in Japan. 

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