US real GDP: No case for a Fed rate hike in March – Wells Fargo
By FXStreet FXStreet (Córdoba) – Analysts from Wells Fargo affirmed that after 4Q real GDP, there is no case for a Federal Reserve rate hike in March; but they noted some positive signs from the report.
Key Quotes:
“Real GDP rose at a 0.7 percent annual pace in the fourth quarter following a 2.0 percent rate in the third quarter. It is worth noting that since the 1980s, real GDP has trended lower—a signal of a changing framework for the economy.”
“There is some positive news in the report. Real final sales to domestic purchasers, which excludes inventories and trade, rose at a 1.6 percent pace following a 2.9 percent increase in the second quarter.”
“Consumer spending remains a positive force with the support of improving labor market conditions and stronger purchasing power due to the decline in retail gasoline prices.”
“In the fourth quarter, overall inflation came in at 0.8 percent with sharp declines in export and import prices. The Fed’s benchmark PCE deflator came in at just 0.1 percent with both durable and nondurable prices registering a decline, but services up at a 2.0 percent pace.”
“Given the modest real GDP gain and continued low inflation, we see no case for a …read more
Source:: FX Street
