November 29, 2017
Third-quarter GDP was even a little bit stronger than first estimated, now at 3.3 percent annual growth for the second estimate even though consumer spending, at 2.3 percent, was lagging. The 3.3 percent follows a 3.1 percent rate in the second quarter and, compared to expectations for a long-term 2 percent trend, can fairly be described as strong. Yet modest-to-moderate is again the Federal Reserve's assessment of economic growth in a Beige Book where where many descriptions, including for job growth, are growing more positive. Janet Yellen, repeating the need for gradual rate hikes, didn't make any news but pending homes did, jumping in the latest data and adding to Monday's very strong new home sales report for a housing sector that is suddenly picking up steam.
Stocks were widely mixed with the Dow rising 0.4 percent to a new record at 23,940 but the Nasdaq, pulled down by technologies, stumbling 1.3 percent to 6,824. Demand for global bonds dropped on reports that the UK has agreed to a settlement bill with Europe, easing concern over the negative economic consequences of Brexit. Demand for Treasuries also fell with the 10-yield up 5 basis points to 2.38 percent.