Troublesome Housing Sector Drags Down Economic Projections

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Posted To: MND NewsWire

Fannie Mae’s Economic and Strategic Research Group (ESR) upped their projection for economic growth slightly, to 3.1 percent this year , but say housing will probably have little to do with it. The first estimate for the third quarter GDP came in at an annualized 3.5 percent, off a bit from 4.2 percent in the second quarter. Consumer and government spending and a building up in private inventories contributed to growth while business fixed investment was soft, residential fixed investment was down for the third straight quarter and the trade deficit widened. The ESR, in its November Economic Developments, says they expect solid gains in employment and wages to continue, but growth will slow to 2.3 percent next year due to further increases in short-term interest rates and the diminishing effects…(read more)

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