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CNBC Survey: Fed Statement Didn't Change Pros' Forecasts

The Federal Reserve's statement today did not change the view of most economists and strategists according to a CNBC Econ-Recon Snap Survey. A strong majority believe the Fed will keep rates unchanged at its next meeting in September.

The survey of almost 60 of Wall Street's top economists and strategists was conducted for one hour immediately following the Fed's announcement.

It found that 68% of those responding did not change their outlook on whether the Fed will make a move on interest rates. Another 23% believe the Fed is more likely to stay on hold, while just 9% see the Fed as more likely to cut rates.

The Federal Reserve left its key interest rate unchanged and said inflation remains a top concern. In its statement, the Fed said the downside risk to the economy "increased somewhat" from turbulence in the credit markets. The Fed repeated that the predominant risk to the economy remains that inflation will "fail to moderate as expected."

Click Here to Read the Experts' Commentary

Of those surveyed, 92% believe that the Fed will keep rates unchanged at its next meeting Sept. 18. Just 8% said the Fed will cut rates at that meeting.

But the longer term view of many in the group is that the Fed will cut rates. Forty-nine percent of the participants believe the Fed funds rate will be lower six months from now. Just less than half, 46%, believe the Fed funds rate will be at its current 5.25% level, and 29% expect a rate of 5%.

The Fed was seen as properly balanced in its concerns about inflation and growth by 64%. Another 34% said the Fed is too worried about inflation while just 2% said it is too worried about growth.

We are also asking our users to take the same survey. We'll be comparing these "Main Street" results to the pros. CLICK HERE TO TAKE THE CNBC ECON-RECON SNAP SURVEY

TEXT OF OFFICIAL RESULTS OF ECON-RECON SNAP WALL STREET SURVEY

TEXT OF OFFICIAL RESULTS OF CNBC ECON-RECON SNAP WALL STREET SURVEY

These survey results represent the opinions of almost 60 of the nation’s top money managers, investment strategists and professional economists.

They responded to CNBC’s invitation to participate in our online survey. Their responses were collected between 2:30pm ET and 3:30 pm ET on August 7, 2007, just after the Federal Reserve’s public announcement following its policy-making meeting. Participants were told their answers would be reported only in the aggregate unless CNBC requested and received permission to publicly reveal specific responses. Participants were not required to answer every question.

This is not intended to be a scientific poll and its results should not be extrapolated beyond those who did accept our invitation.

We are also asking our users to take the same survey. We'll be comparing these "Main Street" results to the pros. CLICK HERE TO TAKE THE CNBC ECON-RECON SNAP SURVEY


Compared to your outlook prior to today's meeting, do you believe the Fed is now:

More likely to cut: 9%

More likely to hike: 0%

More likely to stay on hold: 23%

The statement did not change my views: 68%


At the next meeting, do you believe the Fed will:

Hike rates: 0%

Cut rates: 8%

Keep rates unchanged: 92%


The Fed is:

Too worried about inflation: 34%

Too worried about growth: 2%

Addressing both concerns properly: 64%


Where do you think the Fed Funds rate will be six months from now?

4.00% or less: 0%

4.25%: 2%

4.50%: 3%

4.75%: 15%

5.00%: 29%

5.25% (the current level): 46%

5.50%: 3%

5.75%: 0%

6.00% or higher: 2%

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