In the latest glimpse at the future by CUNA economists yesterday, the U.S. economy is expected to grow by 2.25 percent in 2016, and 2.5 percent in 2017. CUNA economists lowered their outlook for U.S. gross domestic products (GDP) growth by 0.25 percent for both 2016 and 2017, respectively, in the June 2016 CUNA Economic and CU Forecast.
“The meager downward revision to GDP reflects our view of uncertainty on the pace of U.S. economic expansion, which continues to remain modest,” said Perc Pineda, CUNA senior economist. “Still, U.S. economic fundamentals are stable. We continue to expect strong credit union financial operations for the rest of the year. In fact, the first quarter CU numbers came in above our forecast.”
CUNA economists expect only one rate hike this year, down from two. They predict the Federal Open Market Committee will bump the Fed funds interest rate 10 basis points to 0.6 percent at its December meeting. Credit union loan balances are expected to increase by 10.2 percent in 2016 and 9 percent in 2017. The credit union savings growth forecast is up, as well, moving from 5 percent to 6.1 percent this year and from 4 percent to 5 percent in 2017.