CNBC Fed Survey Paints Bleak Economic Picture


With their balance sheet already growing at an astronomical rate, a recent CNBC Fed survey indicates the Federal Reserve could be adding trillions more by the end of Q2. The average estimate among the 36 respondents suggests the balance sheet could grow to $9.8 trillion from the current $6.45 trillion. Survey results also show some startling predictions for unemployment and GDP. Respondents see unemployment hitting 19% by August, and Q2 GDP contracting 24%.

Looking past Q2, however, there is far less consensus. About a third of those surveyed don’t see a full recovery until 2022, while 19% see a complete restoration by year-end, and another 19% think it will recover even sooner. The latter group might be a bit too optimistic given the magnitude of the damage – especially if they are calling for a ‘full-recovery.’ With all this talk of economies reopening and recovery timelines, it will be interesting to hear from Powell tomorrow and see where he falls on this. The Fed began its two-day policy meeting today, the first since they slashed rates to near-zero in March, and Powell will be at the podium tomorrow at 2:30 pm EST.

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