It is primarily the drop in oil prices -- not the wild ride in the stock market -- that will keep the Federal Reserve from aggressively raising interest rates in 2016, said Luke Tilley, chief economist at Wilmington Trust.

"We've seen oil prices come down quite a bit, and that's really going to affect the inflation forecast going forward through 2016," said Tilley. "We've reduced our inflation forecast to a lower path over the course of 2016 and I think that is what is really going to keep the Fed on hold."

Tilley said his base forecast is for slightly higher growth of 2.5% in 2016. He acknowledged the increased recession talk in the market, yet he said his growth case is supported by consumer spending, stronger investment, and some contribution from government. The U.S., in his view, is expected to outperform the other major developed economies of Europe and Japan.

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He said his longer-run forecast for the U.S. is for slowing economic growth, down to 2% in his 10 year forecast. This is due to slowing labor force growth and moderate productivity growth. He added that a retiring population poses a risk to labor force growth and to the fiscal budget.

Regarding the idea that a slowing Chinese economy could drag the U.S. into a recession, Tilley also recognized that possibility, especially after Apple (AAPL) - Get Report CEO Tim Cook discussed softness in China during the technology giant's earnings report Tuesday. On the whole, however, he does not think that will be the case.

"We've seen many times over history where an appreciated dollar has weighed heavily on emerging markets and still the U.S. economy did fairly well," said Tilley.

Tilley said he expects a modest rise in interest rates and mild equity market price appreciation. In his view, interest and dividends will likely become the primary portion of total returns so investors should be looking for those types of opportunities.

"If our forecast holds and we get economic growth, we should start to see these fears and this fleeing into safe haven assets disappear over the course of the year," said Tilley. "That would translate to Federal Reserve rate hikes over the course of the year, probably not four like they've communicated, more like two or three. And that would move the 10 year Treasury yield to 2.4% or 2.5% by the end of the year."