U.S. Outlook: Replacing liftoff with gradual levitation

Posted By Scott Anderson In Uncategorized | No Comments

The word “liftoff” brings visions of a rocket on the launch pad ready to vault into space. But recent downward revisions to our growth outlook suggest a far calmer interest-rate normalization approach.

Graph laying out the interest rate forecasts into next year. [1]While I still believe the FOMC will raise interest rates for the first time in December 2015, I expect long pauses before each successive move upward.

For more on this and other economic developments this week, see my full report [2]. Highlights are outlined below, followed by a link to the full U.S. Outlook report, delivered on Oct 9.

Key observations:
  • We are penciling in three more small interest-rate hikes in 2016.
  • For the U.S. we expect the push and pull from relatively robust consumer spending and housing demand to be nearly equally balanced by relative weakness in business spending, industrial production, exports, and business inventories in the quarters ahead.
  • The rate outlook bodes well for home buyers.
Click here to read my full report. [2]

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URL to article: https://changematters.bankofthewest.com/2015/10/09/u-s-outlook-replacing-liftoff-with-gradual-levitation/

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[1] Image: http://blog.bankofthewest.com/wp-content/uploads/2015/10/graph_interestrates_forecasts_100915.jpg

[2] see my full report: http://blog.bankofthewest.com/wp-content/uploads/2015/10/BankoftheWest_USOutlook_10_09_15.pdf

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