It’s the time of year when all the major banks make their forecasts for the coming year. Are they really worthy of use for your investment strategy? Before you react to the 2023 forecasts, let’s look back at their previous years’ outlooks to see just how reliable (or unreliable) these one-year forecasts really are.

It’s that time of the year! When all the major banks make the forecasts for the year. Yet, before you listen to their 2022 forecasts, we must look back at their previous years’ outlooks to see just how reliable (or unreliable) these one-year forecasts really are.

For the past several years, we have looked back at the market forecasts provided by the economists of the major banks. This year, we take a look at not just the original forecasts for 2020, but also how the forecasts changed in the midst of COVID-19, and how you should respond to these “expert” predictions.

We have often cited studies on how poorly forecasters foretell the future. For the past several years, we have looked back at annual S&P 500 index forecasts provided by economists at major US banks to see how they did. As the great philosopher/baseball player, Yogi Berra would say, “It’s tough to make predictions, especially about the future.”