IMF Lowers 2014 GDP Estimate

stoitoOn Monday U.S. stock markets held on to some gains after digesting a variety of economic data about the U.S. economy and coming to terms with volatile geo-political situations in Iraq and Ukraine.

The Nasdaq saw the largest gains of .24 percent while the Dow rose .03 percent and the S&P 500 increased 0.10 percent.

On Monday Washington- based International Monetary Fund (IMF) lowered their 2014 GDP estimate down to 2 percent.

IMF Managing Director Christine Lagarde admitted that cold winter weather in the first quarter of 2014 was largely to blame for the lowered GDP estimate which is well below an earlier GDP estimate of 2.8 percent in April.

A recent 2nd estimate of  real gross domestic product (GDP) showed that economic output in the U.S. actually declined 1 percent in the first quarter of 2014 versus a gain of 2.6 percent in the 4th quarter of 2013.

Lagarde  explained in Monday’s press conference that 2 percent growth for 2014 is “significantly lower than the 3 percent average that we have seen between 1948 and 2007.”

Lagarde remains optimistic about growth prospects in future quarters.

“We believe that there will be growth in the remaining quarters at about 3 percent or possibly higher than that. In 2015 we expect growth to hit its highest annual rate since 2005.” Lagarde said.

Housing Data

On Monday the sentiment gauge for the National Association of Home Builders jumped to 49 in June from 45 in May, marking the largest increase since July 2013.

Tuesday morning will see the latest housing starts for May released.

The majority of the housing starts estimates for May are below the five month high that was seen in April which had 1.07 million units added.

On Tuesday building starts for May will also be released.

-Johnathan Schweitzer









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