-more-->The strength in consumer spending led the ESR Group to up its forecast of third quarter 2019 GDP growth by one-tenth to 1.9%. However, a measure of consumer sentiment suggesting potential deterioration in second-half spending, along with weaker manufacturing data and further evidence that business investment is slowing due to geopolitical uncertainty, contributed to a downward revision to the ESR Group’s headline growth forecast for 2020 to 1.6%. The Group still believes that the Fed will cut interest rates again in 2019 but notes risks remain biased to the downside, as trade tensions, a potential no-deal Brexit, and other concerns weigh on the markets.

The ESR Group maintains that mortgage demand remains on solid footing but notes that the lack of existing supply continues to limit home sales even as mortgage rates push new lows. The current low interest rate environment may be supportive of new construction, but the scarcity of existing home listings led the ESR Group to lower its existing sales growth forecast in 2019 to negative 0.3%. Total mortgage originations in 2019 are still expected to rise 11.6% year-over-year, due largely to another upward revision in projected refinance activity, which, according to the recently released Mortgage Lender Sentiment Survey®, lenders n