Canadian Imperial Bank of Commerce Predicts Upward Revision in US Economic Growth
CIBC Forecasts Additional Federal Reserve Rate Hike
Canadian Imperial Bank of Commerce (CIBC) has recently released a forecast that contradicts current market expectations. According to CIBC, there is a strong possibility of an upward revision in US economic growth and an additional Federal Reserve rate hike this year. This prediction is based on several factors that CIBC has taken into consideration.
Higher US Growth Rate and Delayed Slowdown
CIBC has revised its forecast to include a higher US growth rate and a delayed slowdown. The bank now estimates that the US economy will experience a third-quarter GDP boost of nearly 4%, up from its earlier estimate of 2.5%. This revision indicates a more positive outlook for the US economy than previously anticipated.
Potential Negative Growth in the Fourth Quarter
In addition to the revised growth rate, CIBC also sees a slight chance of negative growth in the fourth quarter. This suggests that there are still uncertainties in the market that could impact the US economy in the coming months. However, CIBC remains optimistic about the overall performance of the economy.
Central Bank’s Role in Avoiding Recession
CIBC believes that the central bank can play a pivotal role in avoiding a recession by easing rates in the second half of 2024. The bank emphasizes the importance of strategic decision-making by the central bank to maintain economic stability and growth. However, CIBC does not anticipate any changes to its Bank of Canada terminal rates forecast.
Monitoring Key Indicators
CIBC is closely monitoring various indicators to assess the health of the US economy. These indicators include an inverted yield curve, slowing bank lending, housing starts and resales, and the potential for US growth to stall in the first quarter of 2024. By keeping a close eye on these indicators, CIBC aims to provide accurate and timely insights to its clients and stakeholders.
The predictions made by CIBC are based on thorough analysis and research. The bank is actively following speeches from influential figures such as Federal Reserve Bank of New York President John Williams and Federal Reserve Chair Jerome Powell for any signals that may impact rate setting. This proactive approach enables CIBC to stay ahead of market trends and provide valuable guidance to its clients.
It is important to note that the forecasts provided by CIBC are subject to change based on evolving market conditions. As the global economic landscape continues to evolve, CIBC remains committed to providing the most accurate and reliable insights to its clients and stakeholders.