Economic Growth Q1 2016, Housing News, Consumer Confidence
June 28, 2016
Tuesday – June 28
The government reported on Tuesday that economic growth in the first quarter of 2016 edged higher from the previous two readings, though still below what is seen as a normal growing economy. Gross Domestic Product (GDP) rose 1.1% from the previous reading of 0.8%, though still weak compared to the past several years. Exports rose modestly, while consumer spending saw its smallest gain in two years. Many economists see a 2.5% gain in the second quarter, but that may be the best we can see in 2016. GDP measures the monetary value of all finished goods and services within a country’s borders in a given period.
In housing news, the S&P/Case Shiller 20-city Home Price Index showed a solid gain of 5.4% from April 2015 to April 2016. Despite a somewhat slowing economy and job market, housing has remained a bright spot for the U.S. economy. On a nationwide basis, home prices rose 5.0% in the 12 months ended in April. Since early 2015, prices have seen a 5% annual increase. Last week’s Brexit vote and ensuing fallout could put a slight dent in consumer confidence, which could make potential buyers a bit more hesitant to make a major home purchase.
Consumer Confidence surged in June ahead of last week’s Brexit vote, hitting its highest level since October. Consumer Confidence hit 98 in June, well above the 93.1 expected and up from the 92.4 recorded in May. The report revealed that consumers’ appraisal of current conditions improved in June, while those stating business conditions are “good” increased and those saying business was “bad” decreased.