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Quarter-End Insights

Economic Outlook: More Slow Growth but Labor Scarcity

U.S. real GDP growth in 2015 will likely fall in the 2.0%-2.5% range yet again, but labor tightness is building.

Robert Johnson, CFA

Mar 30, 2015

Mentioned: Walmart Inc (WMT) , Gap Inc (GPS) , Target Corp (TGT)

U.S. economic growth is likely to remain lower than many believe, at 2.0% to 2.5%, but high enough to create labor market shortages.
The quarter's notable developments were the ECB quantitative easing program (which resulted in a sharply falling euro), weaker growth in China, bad weather (again), and slowing U.S. exports.
Threats of labor scarcity are building, helping consumers but potentially sparking higher inflation and lower corporate profits.

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Robert Johnson, CFA does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

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