May 13, 2019 — Are Q1 Results not Sustainable?

MAY 13, 2019 – ARE Q1 RESULTS NOT SUSTAINABLE?

 The pace of economic growth in the first quarter of this year was robust, but economists do not believe the pace is sustainable going forward. 

The median estimate for growth in 2019 has risen to 2.6 percent, from 2.4 percent, to accommodate the Q1 results.  Forecasts for the second half of the year remain at 2.1 percent.  The results show economists do not believe the White House’s goal of 3 percent growth through 2021 is likely.  Inventory build-up over the last few quarters is expected to slow growth in the second half of this year.

The Fed continues to hold rates steady, despite Trump’s call to cut rates by a full percentage point to supercharge the economy.  With inflation moderate, Fed Chair Powell says there is no reason to move rates either up or down.