The Economic Year in Review

WSJ What's News
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Automatic TRANSCRIPT

The US economy saw strong jobs growth and record low unemployment in two thousand eighteen despite ongoing trade tensions that threatened to derail progress joining us now from Washington with a look back and a look ahead is Wall Street Journal reporter Harriet Tory Harriet this year, there was a lot to be happy about economically speaking. But there were also some weak spots as the Wall Street Journal has been reporting especially in the housing market. Generally speaking, though, twenty eighteen has been a pretty strong year. Yes, that's correct. Very thin. 2018 has been strong among the strongest rates in the second quarter that we saw in this entire expansion. So it was definitely a good year for the economy. The jobless rate went way down to three point seven percent is a forty nine year low which is extremely good news for many Americans. People to a working them incomes arising. It's been kind of a sweet spot. But of course, there have been a couple of shadows as well. So we've seen interest rates gradually edging up higher over the past. Couple of is the fed raise rates four times this year. What does that have a big impact on? Of course, it's mortgage rates in the housing market is a big piece of it when it comes to consumers. So we've seen the housing market really slow down inventory is we'll so pretty low. There's not that much on the market prices, a high it just creates a bit of a difficult situation for a of bias who would like to get on the housing Leto, or perhaps some you know, that hesitant to get a new mortgage because they've enjoyed low rates and those low rates not so attainable anymore. And this was also the first year under the nation's new tax code. Did. We see the intended impacts of that overhaul spurring more business investment, for example, as the administration had hoped it would we definitely did earlier in the so the first quarter, we're big dump in business investment and not continued in the second. And then in the second quarter that was when we consume as really seemed to sort of become cognizant of the extra money, the extra dollars in that pockets, the, you know, the low withholding and consumers, really Spence very strong may in the second of the quotas business. Investments seemed to slow the pace of growth did pull back in the quota. So there are some concerns that that sort of might have been it in terms of the tax overhaul that remains to be seen. We weren't see data for the fourth quarter gross domestic products until until late January. So we'll see we'll see how it goes. It seems like consumer sentiment remains at a high level and consumers like he spent pretty strongly during the holiday season. So definitely from the consumer situation. It seems like they tax cut did have the desired effect. You know, the consumer spending piece of the puzzle has been driving a lot of economic growth over this year business investment has been more of a mixed bag, but it also relatively solid Harriet. Let's talk about some of the factors that threaten to derail economic growth this year. Of course, one of them has been. Certainty over trade, especially between the US and China. Yes. That's definitely been the case. And we've seen trade tensions really throw Mockus for a loop on several occasions over the and looking ahead to two thousand nineteen the will she journal survey of economists polls about sixty Malkin, economists also the biggest risk is twenty nineteen on. Most of them said is the potential for trade war between Washington and Beijing missus it's hard to know how that might play out and people that nervous about it. So far, you know, we've seen tariffs imposed on suss and goods the impact has been pretty small inflation is still is still low in the US economy. We haven't seen a breakout of vacation that some people wounding about when the towers with us discussed, however, nonetheless, despite these relatively mild impacts on the US economy, it has created, you know, the trade situation has created a lot of

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