INFLATION, SENTIMENT, AND THE IMPACT ON COMMERCIAL REAL ESTATE
June Inflation Trending Higher, But Trend Is Positive
- Headline inflation rose to 3.2%, but the more important Core CPI number fell
- The housing component of CPI remains elevated, but is forecasted to fall, aiding the current trend further
Brightened Outlook Boosting CRE Space Demand
- Confidence and sentiment measures for consumers, small businesses and CEOs are all rising in July
- Absorption is likely to rise across products if recession fears keep decreasing and individuals feel optimistic
What To Expect in 2H 2023
- Wall Street is expecting the Fed to keep overnight rates flat through the December meeting
- If positive moment is sustained, it offers a strengthening CRE outlook
*Through 2Q; Small Business Optimism through July
Sources: Marcus & Millichap Research Services, University of Michigan, The Conference Board, NIFB
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