From Goldman Sachs economist Jan Hatzius and Sven Jari Stehn: After the Brexit Shock
Following the UK referendum, we have downgraded our global growth forecast, sharply in the UK and more modestly elsewhere. Increased uncertainty and deteriorating terms of trade are likely to subtract a cumulative 2¾% from UK GDP, and we now expect the economy to enter a mild recession by early 2017. We estimate the cumulative hit to Euro area GDP at ½% and have cut our growth forecast over the next two years to 1¼%. We have also slightly shaved our H2 2016 forecast for US growth to 2%
However, the risks to this forecast are significant and further downward adjustments could well follow.
• Schedule for Week of June 26, 2016
• At 10:30 AM ET, the Dallas Fed Survey of Manufacturing Activity for June.
Oil prices were down over the last week with WTI futures at $47.54 per barrel and Brent at $48.41 per barrel. A year ago, WTI was at $59, and Brent was at $60 – so prices are down 20% year-over-year.
Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $2.31 per gallon (down about $0.45 per gallon from a year ago).