U.S. Outlook: Taking the temperature of the consumer
Consumer spending was back on track in August.
For more on this and other economic developments to watch, see highlights of my weekly economic analysis below, followed by a link to the full U.S. Outlook report, delivered on Oct. 3.Key observations:
- Consumer spending should stay strong in Q4.
- Income growth has finally caught up with spending gains.
- A sharp drop in September light vehicle sales, a contraction in construction spending in July, and lower non-durable manufacturing inventories has prompted us to lower our tracking estimate of GDP for the third quarter to 3.1 percent.
- The Fed may be behind the curve on rate hikes.