Orbex analyst after the US GDP release: In layman’s terms, the economy is entering a contraction phase, which is to be expected given the rising interest rates and the ultra-tight lending environment
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The US GDP hit 2.6%, slightly less than expected. Let's hear from David Kindley from Orbex, who comments on that print on FXMAG.COM request.
Growth expectations are beginning to decline
David Kindley (Orbex): US GDP came in slightly weaker than expected for the fourth quarter (Q4) at 2.6% versus the consensus of 2.7%. It should be noted however that the original estimate by the Commerce Department for Q4 was 2.9%; this indicates that growth expectations are beginning to decline. Meanwhile, looking at Q3, we saw a 2,6% expansion which marked a considerable deceleration from the 3.2% annualized growth recorded during the third quarter. In layman’s terms, the economy is entering a contraction phase, which is to be expected given the rising interest rates and the ultra-tight lending environment. All indications show that the Fed is planning a “controlled recession” for 2023 – 2024, but given the current volatile banking environment, any reversal in their monetary policy could push the stock markets higher.
