Junjie Guo
Executive Summary:
We use a mixed-frequency vector auto-regression model to forecast the U.S. and Wisconsin
economies through the end of 2024.
- For the United States, the model suggests that:
- real GDP will grow by about 2.8% in the first half and 2.3% in the second half; the probability
that real GDP will decline in two consecutive quarters is 13%; - the unemployment rate will rise to about 4.1% by the end of the year; nonfarm employment
will increase by about 1 million; average hourly earnings will increase by about 4.7%; - inflation will fluctuate around 2.6%;
- the federal funds rate will drop to around 4.5% by the end of the year.
For Wisconsin, the model suggests that:
- real GDP will grow by about 1.3%; the probability that real GDP will decline in two consecutive
quarters is 29.7%; - the unemployment rate will remain around 3.4%; nonfarm employment will increase by about
1.2% (36,000 persons); - housing prices will increase by about 11%.