Following the upgrade earlier in the week to GDP expectations according to the Atlanta Federal Reserve GDP model which anticipates second quarter growth near 0.80%, investment banks are in the process of downgrading their own GDP estimates for 2015 as increased headwinds drag on the outlook. Goldman Sachs in particular has revised its long-term outlook for US economic expansion to 1.75% from a prior 2.25% in a sign of declining confidence in the economy. However, in another positive sign for the housing economy, pending home sales rose more than initially forecast, accelerating to 3.4% from a prior 1.20% on expectations of a 0.90% rise. This could translate to a rise in existing home sales in the next reporting period, adding to optimism that the housing recovery is not lopsided as was witnessed in previous months. The dollar has retreated from recent gains, but could move higher today if GDP manages to meet or beat expectations.
US Long-Term Growth Downgraded
Daily Analysis - 29/05/2015