Week Ahead: 4Q GDP and Housing Data

As 4Q data comes out next week much thought is put into what the data will look like, and what caused those numbers to be what they are. The Federal Reserve will be taking the closest look at the data in order to determine if interest rates may be raised.

Analysts seem to believe that GDP will grow, but that the growth will be lower than first expected. One analyst noted that this revision is based not on one component, but of revisions to many of the components of GDP. The article states that the economy slowed down due to various global factors. A few of these would be  weakening demand in emerging markets and the strong value of the dollar which makes U.S. exports more expensive. Another important factor is that at the end of the year companies sought to slash bloated inventories.

It will be interesting to see this data when it is released. If growth is slow like is expected then it will be interesting to see how the Federal Reserve reacts. I wonder if even with slower than expected growth if the fed could be tempted to raise the interest rate. Although we may may not know what actions will be taken, we will have a better idea once the data is released this coming week.