The United States first quarter is expected to tally soft results as seasonal changes take full effect. The consumer spending saw a sharp turn and will gravely hit the first quarter results. On the brighter side, economists expect a better second quarter as consumer spending claws its way back up.
The gross domestic product is expected to slump after having a stellar prior quarter, pulled by major factors, the GDP is predicted to hit an all-time low.
United States Consumer Spending
The expected consumer spending for the quarter is hovering somewhere below the 1.5%. This would be the slowest pace the economic factor would have since 2013.
Furthermore, the massive labor market adjustments have caused quite the conundrum in the previous months. The event has greatly affected the sharp consumer spending in the previous quarter.
According to economists, the homebuilding for the quarter saw some dips on their investment. Furthermore, the growing trade deficit persists as a looming problem for the already problematic quarter.
The country is expected to announce their first quarter performance this coming Friday. The prior quarter, fourth-quarter, saw an increase of about 2.9%. Analysts are expecting a total of 2% increase in the gross domestic products or GDP.
United States Q2 Expectations
On the brighter side, the labor market is pushing a lot of positive figures as it nears to full employment, meanwhile, consumer confidence remained unwaveringly strong.
Furthermore, the analysts and economists are expecting the economy to speed up its growth comes the second quarter. That will also be the same quarter where the Trump Administration’s income tax package will be on its full blast.
The coming quarter will most likely benefit from the rapidly growing government spending. The lower corporate and individual tax rates are also looking to heavily change next quarter’s course as consumer spending will most likely pick up as well.
The Federal Reserve Officers will most likely dismiss the expected soft quarter results. The upbeat labor market and the growing economy are looking to boost the possibility of another interest rate hike next quarter.
On the other hand, the U.S. durable goods orders managed to climb last March. The orders managed to increase by 2.5%, as opposed to the 1.6% forecasts. The terrific data showed that the country is picking up its pace this second quarter.
The orders from toasters to massive aircraft managed to buoy positive data from last month. According to reports, the positive figures are expected to last to three or more years. Meanwhile, the demand for transportation equipment also managed to increase by 7.6% last month.
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