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CME Insights: Sluggish 2016 Real GDP Growth Expectations

Multiple factors are playing into expectations for disappointing real GDP growth in 2016 according to a report released by CME Group. Both short term and longer term considerations have led to this outlook from Blu Putnam, the Chief Economist of CME Group, including:

  • Continuing shift in workforce composition from baby boomers towards millennials
  • Stagnant growth in US workforce & lack of increase in labor productivity
  • Near term impact of Mississippi River Valley flooding on GDP growth for Q1 & Q2
  • Slow international growth across the economies of China, Brazil, and Russia
  • Resulting decline in currencies

Based on these expectations and inflation predictions, Putnam also cites a possible delay in the Fed’s net rate hike until the summer months.

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