What were the hits and misses

Goldman Sachs economists David Mericle and Daan Struyven compiled the Economic Forecasters' Hits and Misses in 2015 in the AFR.

  1. Most forecasters expected 3% US growth and once again that was probably a percentage point too high It's the 13th time in 16 years economists have overestimated growth.
  2. 10-year yields were forecast to rise 0.75 percentage points but finish the year clear flat
  3. Economists thought the Fed would hike 3 times. They raised rates once
  4. Inflation was roughly a half-point softer than anticipated

As for 2016?

"We expect that GDP will grow at a 2.25 per cent rate in 2016, the unemployment rate will decline a further 0.4 of a percentage point to 4.6 per cent and core inflation will rise 0.3 of a percentage point to 1.6 per cent," Goldman says.

"The pattern of recent years suggests some reason for caution, highlighting the risks of weaker growth, a larger decline in the unemployment rate, and softer inflation. If growth disappoints again and inflation remains soft, we would not be surprised to see more substantial revisions to long-term consensus forecasts