The FMCC report on US economy and the housing market
Apt that we get this report after the strong housing numbers and there's warnings afoot for borrowers
The highlights;
- US growth forecasts for 2015 cut to 2.3% from 2.6% in the prior estimates on the weaker first quarter
- 2015 house prices expected to show growth of 4.5% vs 4.0% prior
- Strong refinance activity has caused estimates to be raised for mortgage originations
- Housing markets to see increased rate volatility in anticipation of Fed rate action
- Low rates have continued to help homebuyer affordability
An economy should be able to weather a 25bp rise in rates without too much fuss but the US consumer is still keeping the wallet shut and that means money is still tight or that paying down debt is more important. That's the main are that will take a beating when rates rise and will likely keep consumer spending down
Bloomberg carry the story
