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GDP grew in Q3, Consumer sentiment below expected for October, Home prices rose

October 27, 2017

The Bureau of Economic Analysis reports that Gross Domestic Product (GDP) grew by a solid 3% in the third quarter based on the first of three readings. Gains were led by private inventory investments, exports and federal government spending. Within GDP, consumer spending increased 2.4% following the 3.3% rise in Q2. GDP is the monetary value of all finished goods and services produced within a country’s borders in a specific time period. It is considered the broadest measure of economic activity.

Consumer Sentiment came in at 100.7 for the final reading in October, just below the 101.0 expected and remains at lofty levels. The report revealed that personal finances were judged near all-time record favorable levels due to gains in household incomes as well as decade highs in home and stock values. Chief economist, Richard Curtin said, “Lingering doubts about the near-term strength of the national economy were dispelled as more than half of all respondents expected good times during the year ahead and anticipated the expansion to continue uninterrupted over the next five years.”

The Federal Housing Finance Agency reported this week that home prices rose 0.7% from July to August with a 6.6% jump year over year. The FHFA monthly Home Price Index is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. The index doesn’t include high-end homes purchased with jumbo loans or cash sales.