Lower, but steady, economic growth expected in Q4

This week brings the last significant snapshot of the U.S. economy in 2016. It’s expected to show continued moderate growth, a solid housing recovery and a nascent rebound for business investment. Existing home sales have been on a tear lately, rising for three straight months and notching the highest level in nearly a decade in November. That strong reading likely reflects homeowners who scrambled to lock in low borrowing costs before a rise in interest rates, says Nomura economist Lewis Alexander. But, he notes, pending home sales fell modestly recently, indicating closings may have softened in December. Economists estimate the National Association of Realtors will announce Tuesday that existing home sales dipped 1.1% last month to a still-solid seasonally adjusted annual rate of 5.6 million. New home sales also have been healthy, recording a 5.2% jump in November. Sales of new homes represent about 10% of the total market but help set the course of housing starts, a driver of construction employment and economic growth.

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