U.S. Economic Growth Lowered for Second Half of 2013, by Mortgage Bankers Association
Overall economic growth will be slower than originally forecast for the last half of 2013, according to the Mortgage Bankers Association’s recent MBA Economic and Mortgage Finance Commentary. According to the report, the U.S. is still facing several unknowns that are impacting economic growth. First, the situation in Europe is far from settled. While there are signs of growth in some of the stronger economies, the austerity measures in several southern European nations are facing increasing political opposition with no clear alternatives. Second, the political situation in the Middle East could flare up and already the situation in Egypt has driven up the world price of oil. Third, developments in China could impact that nation’s ability to invest in U.S. and other international securities. Finally, the domestic uncertainty over tax rates and what sections of the national health care law will be enforced and when continue to hold back small business hiring and investment.
The report noted that consumer spending will be somewhat higher, with the auto and energy-related manufacturing sectors continuing to improve. Retail sales grew in the second quarter, driven by the strongest spending on motor vehicles and parts since 2011. There was a sharp pickup in residential housing investment in the second quarter, higher than what the Mortgage Bankers Association was expecting. “As a result, we expect that housing investment will continue at current levels, but will not be the driver of growth that we had expected in the second half of the year,” according to the report.
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