Citi sees Fed cutting rates at each consecutive meeting staring in September
The U.S. gross domestic product expanded at an annualized rate of 2.8% in the second quarter, which marks a massive jump from the 1.4% growth rate observed in the first quarter and much higher than the consensus of 2.0%.
Citi economists highlighted a stagnation in goods consumption and a slowdown in services consumption in the second quarter compared to the first. The analysis pointed out that the trends in goods consumption have been largely moving sideways throughout this year. However, Citi's analysis also indicated a decline in both residential investment and non-residential structures investment. These sectors are expected to continue facing challenges and remain soft in the near future.
"But we would caution against extrapolating Q2 strength to coming quarters and continue to expect a weakening labor market that will have Fed officials cutting rates at each consecutive meeting starting in September."Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors.
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