Economic forecasters at the North American Ag Lending Conference last week in
- Continued economic growth. Estimated growth in gross domestic product (GDP) is as follows:
, 3%; U.S. , 8 %; China , 6 %; India Latin America, 3-3.5 %, , 4 %. Canada Europecontinues to show GDP growth but at a very slow pace. That slow growth will put pressure on Europe’s trade imbalance with its trading partners.
- Low inflation to continue globally. In the
one of the biggest threats to inflation is increasing labor cost. Wage growth is already climbing due in part to increased wages and bonuses needed to lure workers back to the U.S. areas hit by Hurricanes Katrina and Rita. Gulf Coast
- Modest increase in interest rates expected globally. In the
, once the Fed reaches a neutral interest rate – one that does not encourage nor discourage business growth and investment – the federal funds rate will probably hold steady at about 4.5 percent. U.S.
The forecast was presented by Mike Swanson, ag economist with Wells Fargo Bank in
Additional points on the
It is important to note, Swanson said, that employment growth will average 1.6 percent this year. That’s a net growth in jobs overall despite the hurricanes.