Report | A Trio of Potential Risks for April 4, 2018
Last week presented a trio of noteworthy risks for commercial real estate, but only one is significant. Economic growth in the fourth quarter of 2017 was revised upward, but that momentum did not carry forward into the first quarter of 2018. Growth should rebound in the coming quarters and that will continue a pattern observed during most of the current expansion. China responded to U.S. steel and aluminum tariffs with roughly $3 billion of its own tariffs on 128 products. Alone, these tariffs pose little threat to the economy, but the risk of escalating trade protectionism is increasing. Meanwhile, inflation is slowly trending upward toward the Fed's two-percent target rate. Continued rising inflation will put upward pressure on interest rates which risk slowing economic growth and impacting the CRE market.
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