Harsh winter weather hasn’t stopped the economy from improving, with interest rates in the United States expected to accelerate in 2014 and beyond.
A new survey by the National Association for Business Economics (NABE) projects that the U.S. economy will grow from an annual rate of 1.9 percent in 2013 to a projected 2.8 percent this year.
In December, the projection for growth in 2014 was 2.5 percent. Current projections expect interest rates to reach 3.1 percent in 2015.
“Conditions in a variety of areas—including labor, consumer, and housing markets—are expected to improve over the next two years, while inflation remains tame,” said Timothy Gill, NABE survey chair.
Forty-eight business economists took part in the survey.
Though the overall forecast was positive, the economists believe that the difficult weather conditions throughout much of the U.S. this winter decreased the gross domestic product at the start of 2014.
NABE’s survey also projects that will stop the bond-buying program this year.
Fifty-seven percent of the surveyed economists think the U.S. Federal Reserve program will end by the fourth quarter of 2014, and 25 percent think it will happen even sooner.
During a press conference on March 19, Janet Yellen, chair of the Federal Reserve said that they would let a “considerable” amount of time pass before ending the program.
When asked for more specifics, there was a moment of hesitation.
“I — I, you know, this is the kind of term it’s hard to define, but, you know, it probably means something on the order of around six months or that type of thing. But, you know, it depends — what the statement is saying is it depends what conditions are like,” Yellen said.
Recent data from Reuters isn’t as optimistic about seeing a rate increase this year.
The news agency released a poll and a survey this month, both showing that the rate increase isn’t expected until 2015.
The Reuters poll was with 63 economists from Wall Street. The survey was with 17 bond dealers.
