By Tom Ozimek Contributing Writer   Economists are expressing greater optimism about the U.S. economy as President-elect Donald Trump prepares to take the reins at the White House, with the latest National Association for Business Economics survey showing that economists have raised their growth projections substantially for 2025 and most no longer see downside risks as predominant.  The periodic survey, released on Monday, reveals an upward revision in economic growth projections for both this year and the next, compared to the last time the panel of 38 professional economic forecasters was polled in September.   Specifically, the current forecast calls for real inflation-adjusted gross domestic product to increase by 2.7% in 2024, up from the 2.6% the panelists expected several months ago. The economists’ prediction for 2025 is even more optimistic, forecasting a 2.0% pace of growth, up 0.2 percentage points from the 1.8% growth they expected a few months before the November election.  “In addition, the largest share of respondents — 44% — now sees the risks surrounding the outlook as balanced, whereas a majority of respondents in the previous survey thought downside risks were more likely than balanced or upside risks,” NABE president Emily Kolinski Morris said in a statement.  Most of the panelists also expect inflation to cool further, predicting that the Consumer Price Index will slow to 2.3% in annual terms by the end of 2025, and the Federal Reserve’s preferred inflation gauge, the core Personal Consumption Expenditure price index, will come in at 2.1% by that time. Slowing inflation means more room for the Federal Reserve to lower interest rates, which the panelists expect will take place “gradually but consistently.”  Fed policymakers focus more on core PCE, which excludes the volatile categories of food and energy, when assessing inflation trends as this gauge provides a more stable measure of underlying inflation pressures.  This week will see the release of PCE inflation data for October, with the latest report for September showing that core PCE remained unchanged from August at 2.7% year over year, although it jumped by 0.3% month over month, up from August’s 0.1% increase.  While the Federal Reserve Bank of Cleveland’s inflation nowcasting model indicates a near-term increase in core PCE inflation, it hints at a gradual decline later, aligning with the Federal Reserve’s latest Summary of Economic Projections, which foresees a downward trajectory for core PCE in both 2024 and 2025.  The Cleveland Fed’s inflation model, updated on Nov. 25, estimates that core PCE inflation rose to 2.76% in October and will have risen to 2.90% by the end of November. At the same time, the nowcast sees the core PCE month-over-month readings declining from 0.24% in October to 0.23% in November, suggesting the onset of a potential downward trend, which would be consistent with the view of the NABE economists and Fed officials.  In their latest Summary of Economic Projections, released in September, Fed policymakers expected core PCE to fall to 2.6% by the end of 2024, a drop from the 2.8% they projected in June. They also lowered their projections for core PCE in 2025, expecting it to come in at 2.2%, lower than the 2.3% they forecast during the summer and 0.1 percentage point higher than the NABE panel’s prediction for next year.  The increase in optimism about the future of the U.S. economy expressed by NABE forecasters dovetails with a jump in positive sentiment expressed by consumers and members of the business community alike.  The latest S&P Global Flash PMI survey of the manufacturing and service industries, released on Nov. 22, showed a broad-based improvement in year-ahead business confidence, which was particularly notable in U.S. factories, where it hit a 31-month high.  “The business mood has brightened in November, with confidence about the year ahead hitting a two-and-a-half year high,” Chris Williamson, chief business economist at S&P Global Market Intelligence, said in a statement. “The prospect of lower interest rates and a more pro-business approach from the incoming administration has fueled greater optimism, in turn helping drive output and order book inflows higher in November.”  The University of Michigan Consumer Sentiment survey, released on Nov. 22, showed an uptick in consumer confidence, while year-ahead inflation expectations eased.  The post Economists grow more optimistic about US economy in 2025  appeared first on Santa Clarita Valley Signal.