Economy
Fannie Mae Suggests How Administration Changes May Impact 2017 Outlook
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Fannie Mae has released some of its expectations for 2016 and 2017 based upon changes in the new administration ahead. The government-sponsored entity’s Economic & Strategic Research Group released its November 2016 Economic and Housing Outlook and said that while the new administration brings economic uncertainties, it’s still expecting modest growth.
Fannie Mae views the slowdown in job growth and business investment as an indication that the economic expansion has transitioned to a late-cycle phase. This is where growth tends to moderate and make the economy more vulnerable to shocks.
The group continues to expect economic growth to pick up in the second half of this year. GDP is expected to average 2.4% in the second half versus 1.1% growth during the first half — for an average of 1.8% full 2016 GDP. Fannie Mae stills sees a similar pace of growth expected for 2017.
Fannie Mae made numerous quotes in its forecast. They have not made formal changes yet, but did say that the group will incorporate new policy assumptions into forecasts as they become more concrete.
Some of these quotes and outlook statements were noted as follows by Fannie Mae:
This may not seem like much will change, but Fannie Mae remains a controversial government-sponsored entity. Some in Congress would like to see it shut down or altered drastically because the mortgage mess was such a massive contributor to the great recession. Fannie Mae is likely to make its formal changes next year after the new administration’s policies become more concrete.
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