The critical GDP or Gross Domestic Product numbers came out Friday. This is a measure of economic activity, a key factor in the central bank’s decisions on interest rates.
We saw rates rise another quarter point in July and the next decision comes in early September so this data point will be an important element in the bank’s deliberations.
What we saw was an increase in May. Part of that was the return to work of striking federal employees which skews the numbers a bit and some economists read the overall report – which saw increased activity in home sales again and stronger activity in the automotive business – as showing signs of an economic slowdown as we head deeper into the second half of the year.So…while this report provides a fuzzy picture of what lies ahead for interest rates there is one thing that may cause the bank to pause again… growing fears of what is going to happen as more and more people face mortgage renewals with much higher debt service costs later this year and into 2024.
