Although the U.S. economic outlook has dimmed somewhat, interest rates are still expected to rise this year, according to a Securities Industry and Financial Markets Association (SIFMA) survey of U.S. securities industry economists.

SIFMA’s Economic Advisory Roundtable unveiled its latest outlook on Tuesday, which forecasts that the U.S. economy will grow by 2.2% in 2015 and by 2.8% in 2016. The outlook for the rest of 2015 is weaker than previous forecasts because of a soft start in the first quarter, SIFMA notes.

“Despite the weak first quarter and downgraded outlook, the Roundtable still expects the [U.S. Federal Reserve Board] to begin raising rates later this year,” said Ethan Harris, co-head of global economics research at Bank of America Merrill Lynch and chairman of SIFMA’s Economic Advisory Roundtable.

SIFMA reports that survey respondents were almost unanimous in expecting the Fed’s first rate hike to occur in the third quarter of 2015, with the balance expecting the first hike in the fourth quarter. Labour market conditions are seen as the most important factor in the Fed’s decision to raise rates, SIFMA says, noting that this is followed by inflation and economic activity.

The median survey forecasts for 10-year Treasury rates were 2.2% in June, 2.3% in September, 2.5% in December, 2.6% in March 2016 and 2.78% in June 2016. Roughly two-thirds of respondents expect the Treasury yield curve to flatten by the end of 2015, SIFMA says.

Moreover, all survey respondents expect that the Fed will remove its accommodative reinvestment policy in 2016, with almost 70% expecting this to occur in the first half of 2016 and the remainder in the second half, SIFMA says.

Upside and downside risks to the growth forecasts varied considerably among respondents, SIFMA says.

“The impact of the global economy was the most frequently cited upside risk as well as the second most cited risk to the downside. Other upside influences included capital expenditure and wage growth,” it reports.

“On the downside, weak consumer spending was the most frequently cited downside risk to the economic outlook. To a lesser extent, ‘taper tantrums’ from Fed hikes, weak business investment and a strong dollar trailed global economic slowdown as other downside risks to the economic outlook,” SIFMA adds.

The survey also puts a 60% chance that West Texas Intermediate oil prices will remain between US$55 and US$75 a barrel throughout 2015, with the balance split between prices moving higher or lower from this range.