US: Downside risks for the economic outlook - Wells Fargo

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 18, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Córdoba) - According to analysts from Wells Fargo, last week mixed US data points to a slower pace of economic growth during the last months of 2015, but they expect GDP growth to remain above 2.0 in 2016.

    Key Quotes:

    “We have written on numerous occasions that sectors closely tied to the global economy and energy (trade, mining, and manufacturing) will continue to be challenged; however, areas of the U.S. economy related to domestic demand (residential) should continue to improve this year.”

    “Worries about China’s economy are also building. We continue to beat the drum that the direct economic and financial exposure of the U.S. to China is fairly limited; but, the financial markets are feeling the weight of the indirect effects.”

    “That said, our heads are not in the sand, and we acknowledge that U.S. economic growth has slowed. We now project real GDP likely grew at just a 0.4 percent pace in the fourth quarter, with recent economic releases suggesting there are downside risks to our already weak economic forecast.”

    “One report reflecting this end-of-year slowdown is the advanced retail sales report for December. (…) Moreover, with the December reading now in the books, we can confirm that overall sales for the holiday season were not only disappointing relative to a year earlier but were also the weakest since 2009.

    “Putting all of the data points together for the week (last week), we continue to look for a much slower pace of economic growth in the fourth quarter, but expect real GDP growth to remain in the 2.0 to 2.5 percent range in 2016.”
    For more information, read our latest forex news.

Share This Page

free forex signals