Economy To Show Promise In Second Half Of 2013
The economy is accepted to continue its growth through to the second half of 2013 according to economists like Fannie Mae. The reason for this promising forecast? Steady year-to-date job creation, high consumer confidence and positive housing data proves that the economy is heading in the right direction.
Yes, the growth is modest, but it is growth. Doug Duncan, chief economist at Fannie Mae says, “We are keeping a very close eye on the effect of rising mortgage rates on the housing market and the economy, but our July forecast is little changed from last month.” He goes on to say, “We continue to see growth in housing, partly due to an increase in existing home sales as buyers choose to act while rates remain near historic lows.”
Fannie Mae predicts mortgage rates will gradually rise as we approach 2014, forecasting a 4.7% average in Q4. This surge is expected to continue dragging down refinancing activity into next year.
Momentum at the end of the year is expected to help carry growth in 2014. Home sales are expected to rise 8% throughout 2013 and into the new year. The overall projected growth is set at an above-par pace of 2.6%, which is the strongest since 2005.
How do you see the economy fairing into the new year?