U.S Macro Outlook Q3 2019

by James Lane | Dec 04, 2019
2020 OUTLOOK RESTS ON THE STRENGTH OF THE AMERICAN CONSUMER

GDP growth continued to slow in Q3 2019. Its annual rate of 1.9% was down slightly from Q2’s 2% and down significantly from Q1’s 3.1%. Consumer spending growth remained high at 2.9%, led by gains in durable goods such as autos and furnishings. Declines in stock-building, fixed investment (non-residential) and exports offset some of the growth in consumer spending.

Recent production and survey data indicate an economic slowdown. Alongside weakness in APAC and EMEA, this may influence the Fed to potentially lower interest rates once or twice more in 2020. With subdued economic growth, expect low inflation and inflation expectations and an extended period of low interest rates.

Job growth in 2019 has averaged 167,000 jobs per month, which was below 2018’s average monthly gain of 223,000 jobs, indicating a decelerating job market. However, employment is still growing, which should continue to bolster consumer confidence that unemployment remains near a cyclical low of 3.6%.

Download the full report here.