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US growth could be weakest in more than two years but latest data might not affect Fed’s next move

CNBC [1]
July 26, 2019

The U.S. economy is expected to have grown in the second quarter at the slowest pace in more than two years, but the data will have little bearing on the Fed when it holds its rates meeting next week.

The data could provide a clear picture of the dichotomy in the U.S. economy, where manufacturing and business data has been hit by trade and slipping global growth while U.S. consumers have been more resilient.

GDP for the quarter ended June 30 is scheduled to be released at 8:30 a.m. ET Friday, and is expected to come in at 1.8%, according to economists surveyed in CNBC/Moody’s Analytics Rapid Update [2]. Economists surveyed by Refinitiv also expect 1.8% growth, but the Dow Jones consensus forecast is 2%.

“It should be under 2%,” said Joseph LaVorgna, chief economist Americas at Natixis. “Housing looks weak. Inventories look weak, capex, I don’t think is going to be strong. … That should be partially offset by consumer spending being solid.”

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