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Based on residential investment construction July release (starts 1.428 mn > 1.29 mn Bbg consensus; permits 1.354mn < 1.39mn Bbg consensus):

Figure 1: Residential fixed investment (bold black), Survey of Professional Forecasters August median f’cast (light blue), GDPNow of 8/19 (dark blue square), all in bn.Ch.2017$, SAAR. Source: BEA 2025Q2 advance, Philadelphia Fed, Atlanta Fed, and author’s calculations.

The nowcast undershoots noticeably the Survey of Professional Forecasters’ median, with responses from just a couple weeks ago.

Real 10yr interest rates and nominal mortgage rates are slightly below where they were in January 2025, so I’ll focus on policy uncertainty as a possible determinant of the decline in residential investment. (Although with housing prices declining according to the S&P Case-Shiller index, the real interest rate so defined has risen.)

Figure 2: Residential fixed investment (bold black, left scale), GDPNow of 8/19 (dark blue square, left scale), both in bn.Ch.2017$,

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