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Financials

BRIEF-Fannie Mae says economic growth outlook for 2H 2016 remains unchanged

July 19 (Reuters) - Fannie Mae

* Says economic growth outlook for second half of 2016 remains unchanged from prior forecast at about 2 percent, as per ESR group’s July 2016 economic and housing outlook

* Government spending and residential investment should be positive contributors to economic growth this year

* Brexit’s economic impact should be a near-term positive for U.S. housing and mortgage market

* “Without relief from new construction, housing inventory will likely remain tight,boosting home prices and constraining affordability” in 2016

* View on interest rates remains ‘low for long’ as we believe Fed decision to raise interest rates to likely be on hold until June 2017

* See consumer spending driving growth for rest of 2016 as businesses face headwinds from shrinking profits, weak productivity

* Brexit’s economic impact on U.S. will likely be limited, especially from trade perspective

* Businesses also face headwinds from rising labor costs in face of uncertainty stemming from Brexit and U.S. Presidential election

* Fannie Mae says “Still expect moderate housing expansion for 2016” Source text for Eikon:

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