A Better, but Not Robust, Forecast
Recent economic data reflecting sentiment of both manufacturing and service-sector businesses suggest they might not be that concerned about either the sequester or the end of the payroll tax holiday. This builds from other reports I've recently covered about the consumer and business investment in equipment and software. As a result, economic growth is likely to continue, perhaps at a higher rate, according to researchers at the San Francisco Fed, who pencil in GDP growth in 2013 of 2.7%.
Let's see what the data tell us. For starters, we can look at service sector companies. This is a wide-ranging sector, including industries as diverse as agriculture and mining in the basic commodities category to more economically sensitive sectors such as retail and wholesale. Also included are healthcare, construction, utilities, finance and others. We see that business activity has picked up, according to the Institute for Supply Management's Non-Manufacturing Index. The headline printed at 56.0, a faster clip than in January's 55.2, in this diffusion index where anything above 50 indicates expansion. This is the best growth in the past 12 months....440 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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