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Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) Report On Economic Growth

ESR Group of Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) reported that the economy is moving firmly on the growth path in 2015. The decline in commodity prices, the optimism in the employment sector and increasing income are indicative of strong growth in 2015.All these factors will support housing recovery.

The report

ESR Group of Federal National said that there are consistent signs of growth in the labor market. The consumer confidence is on the rise which will result in higher consumer spending. It will also boost manufacturing activity and pace of recovery in the mortgage industry. The only problem seen is a strong currency that will lead to higher trade deficit. The U.S. economy is anticipated to surge to 2.9% in 2015 from 2.5% in 2014.

The key points

Federal National’s ESR Group reported that the economic growth of2.9% in 2015 is lower than the previous guidance. However, it is still better than the growth achieved in 2014. The aggregate income has surged from improving labor market. The lower commodity prices will not only result in higher consumer spending but will also boost auto sales.

The future ahead

Doug Duncan of Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) said that housing segment will witness robust recovery in 2015. The total home sales are anticipated to surge by more than 6% in 2015. It expects the single-family mortgage to cross $1.2 trillion in the year. Also, the single-family ‘mortgage’ outstanding debt is expected to be flat in 2015.

The factors

The forecast depends on various factors including income growth, stabilized housing affordability, flexible lending standards, strong hiring and many others. The mortgage industry will further gain momentum from the Fed’s decision on interest rates. The short-term interest rates are expected to see a hike in mid-2015. The hike in long-term interest rates can be delayed due to prevailing geopolitical concerns. The global economic growth will also be evaluated before taking a final decision on long-term interest rates.

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