1. 2016 Economic Outlook Dennis A. Johnson, CFA Chief Investment Officer

2. Points of View
Fed achieves lift-off, future increase in interest rates will be data dependent.
U.S. real GDP growth is projected to be 2.4% in 2016 versus 2.5% in
Consumer prices are projected to increase by 2.1% in 2016 compared to inflation of 0.2% in 2015.
Michigan’s economy is projected to continue to grow in 2016, but at a more measured pace versus the last several years.

3. Federal Reserve

6. U.S. Economy

12. Inflation

13. Source: Federal Reserve Bank of Dallas

18. International Economics

19. Economic growth in the euro zone has stabilized

20. Canada is a mixed bag

21. Mexico’s economy hanging in their despite weak energy prices

22. India remains one of the fastest growing economies

23. Japan’s economic growth remains volatile

24. China’s government transitioning the foundation of their economy for less volatile long-term growth

25. Michigan Economy

27. Conclusion

28. U.S. economy expected to perform relatively well in 2016.
Inflations trends higher despite downward pressure from oil and the impact of the strong U.S. dollar.
Next rate hike by the Fed could occur at their March meeting.
Economic growth in Michigan may begin to underperform the rest of the U.S. due to the maturation of the current auto cycle and the impact of the strong U.S. dollar on the manufacturing segment of the economy.

29. Disclosure
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