- The January Beige Book survey indicated that economic activity continued to expand across most regions and sectors through the end of 2013, and GDP growth in 4Q13 indicated improving consumer spending and business investment. We believe this confirms the consensus view that the Federal Reserve will continue to reduce bond purchases through year end 2014.
- The debt ceiling debate remains an unknown risk at this point, but we believe it will be resolved relatively quickly without
any significant impact on the financial markets and consumer and business confidence.
- Recent financial market turmoil in several developing countries has rattled the world equity markets, but we do not anticipate a meaningful impact on the US economy. Indeed, the safe-haven status of the US economy has quickly pulled bond yields lower.
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