Chastened Economists Hopeful for US Soft Landing, Fed Rate Cuts
- Annual economic gathering marked by healthy dose of humble pie
- Many thought a recession was needed to bring down inflation
A shopper outside a wholesale store in Bayonne, New Jersey.
Photographer: Angus Mordant/BloombergThis article is for subscribers only.
Inflation’s roller-coaster ride over the last couple of years has left economists humbled about their forecasting abilities but hopeful for a soft landing in the US and eventually lower Federal Reserve interest rates.
At the three-day annual meeting of the economics profession that wrapped up in San Antonio on Sunday, numerous participants acknowledged the difficulties they’ve faced in predicting the outlook for the economy and inflation in the post-pandemic world. Many failed to anticipate a burst in inflation to multi-decade highs and then mistakenly believed that it would take a recession to bring it back down.