FXstreet.com (Barcelona) - Over the first half of 2012, US
households increased their savings rate and it is now back to
around its September quarter 2011 level. This puts them on a firmer
footing - a positive in terms of future consumption growth.
Moreover, lower oil prices also support a moderate strengthening in
consumption. According to Antony Kelly, a research analyst at NAB,
"In the housing sector, with the inventory of new homes still very
low, and new construction well below typical levels,
solid-to-strong growth is likely for an extended period."
"The view that the economy will strengthen in time is supported by
our US mini-model which incorporates information embedded in
various factors including interest rates, equity markets, the
exchange rate, oil prices and house prices. Our forecasts are lower
than is suggested by over the next several quarters, reflecting an
expected slower rate of inventory accumulation, currently weak
partial indicators, as well as the heightened level of uncertainty
around policy and overseas developments." he adds.
Much of the U.S. is also facing severe drought conditions and while
agriculture only makes up around 1% of US GDP, the likely increase
in food prices will put some pressure on household budgets.
"Nevertheless as the influence of these factors wane, and global
economic growth strengthens in 2013, the positive factors
supporting a higher rate of growth will reassert themselves." Kelly