First Quarter 2018 Economic Commentary and Timber Market Conditions

Economy
Economic growth continues to improve. The third GDP revision for fourth quarter came in at 2.9%, exceeding the 2.5% estimate from last month, and not far from the 3.2% third quarter figure. Much of the gain came from a sharp uptick in consumer spending, but fixed residential and non-residential investment also contributed significantly. Both inventories and net exports were drags on growth.

We remain convinced that GDP will rise further over at least the next several quarters. The impact of the major fiscal stimulus, in the form of tax cuts and increased government spending, have yet to be absorbed by the economy. By next quarter we believe GDP will exceed 3%. Corollary benefits are in the form of rising employment and wages.

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