Hawaii state economists predict 1% inflation and 2.4% economic growth this year, after their revising their forecast with summer data.
The growth rate forecast, issued by the state Department of Business, Economic Development & Tourism, is one tenth better than the last update, and the low inflation forecast is the same as before.
For 2016, DBEDT continues to predict 2.3% growth with 2.3 inflation, as measured by the Labor Department’s consumer price index for Honolulu.
The state forecast is still fairly close to forecasts by the Council on Revenues and the UH Economic Research Organization. The council forecast of state tax revenues is the basis of state budgeting.
The state Department of Taxation reported this week that current tax receipts are up more than 11% from the same point in the previous fiscal year.
The forecast is predicated on continued health tourism business, more construction work, and no sharp downturn in the Japanese economy, which, it was reported this week, is slipping back into recession.
DBEDT expects visitor arrivals this year to be 8,661,000, up more than 350,000 from the year before, with a further incremental increase in 2016, when visitor spending could come close to $16 billion.
Personal income will come closer to $70 billion this year and surpass it next year, DBEDT said, forecasting unemployment below 4% for the next three years.