Wall Street Journal Survey Revises Iran War Impact Down; Economists Raise U.S. GDP to 2.1% on July 12

According to a Wall Street Journal survey on July 12, economists revised estimates for the economic impact of the Iran war significantly downward compared to April projections. The survey shows U.S. GDP growth for 2026 is now forecast at 2.1%, up from the 2% estimate three months earlier, while the probability of recession within 12 months fell to 25% from 33%.

However, inflation concerns have intensified despite the improved growth outlook. Economists now project 12-month CPI inflation at 3.4%, up from 3.2% in April, and core PCE inflation at 3.2% for 2026 versus 2.9% previously forecast, limiting room for Federal Reserve rate cuts.