Oct 20, 2017

2016 was a year of ups and downs (mostly downs) if we consider the American and global financial landscape.

Under President Obama, the economy struggled and the debt piled even higher. The UK’s exit, or Brexit, from the EU sent ripples through the global economy and many families struggled to achieve their personal financial goals.

Will 2017 continue the dismal economic trend?

Here are 10 financial predictions for this year, both from a macroeconomic or a microeconomic perspective:

1. The dollar’s value will appreciate

As soon as Donald Trump was declared victorious in the 2016 elections, the price of the dollar began to appreciate in the international market. At the end of November, the election month, the dollar had climbed to a 20-month high against the euro. If the Trump-effect continues, Americans might see a few consecutive months of cheaper imports.

2. The euro will depreciate

In addition to the upward trajectory of the dollar, the downward trend of the euro is also expected to affect the buyers this year. While the European Union finds itself in the midst of several crises, the value of euro is expected to stay low in the international market. This means cheaper travel to Europe.

3. Unemployment will hover around 5 percent

Contrary to the picture Trump painted during his campaign, the employment situation in America is much better than it was a few years ago. In 2017, according to financial analyses, the unemployment rate will stay well below the national average of 5.8 percent.

4. Good year to buy a vehicle

A robust auto market means the number of car sales will appreciate in 2017. This year will be, by all means, a good one to buy a vehicle. This year’s projected sales for vehicles are expected to cross 17 million units for the third straight year.

5. A weak GDP Growth

One of the areas where America has lagged far behind the developing countries is economic growth. By the end of last year, the GDP had grown by a mere 1.75 percent. This year, the projected growth is not expected to climb higher than a mere 2.1 percent. This is dwarfed in comparison Myanmar’s stunning 8.6 percent growth.

6. An expected increase in commodity prices

As important as the growth or decline in many macroeconomic factor (like GDP) is, most people don’t really care about it. It doesn’t directly affect the average consumer. What will have a direct impact on your daily shopping, however, is the expected increase in commodity prices in 2017.

7. Interest rates will continue on the way up

It is thought that rising interest rates are good for savings and bad for borrowing. That might not be true when it comes to financial predictions for 2017. For instance, despite the higher interest rates, the US housing market will continue on its upward trend.

8. A bullish trend in the stock market

The Trump effect was also felt in the stock market in the last few months of 2016. This trend is expected to continue in 2017. The upward trend in the stock market, however, will mean higher priced stocks. The overall gain from S&P is expected to be at 0.75 percent which is just slightly higher than a 0.65 percent through an online savings account.

9. A wealth of investment options

The growth in gaming, artificial intelligence, IT, and entertainment sectors means investors will have plenty of opportunities in the stock market. Companies like Disney, Netflix, Apple, and Nvidia are expected to make money in 2017.

10. Oil price slump

Last year saw a considerable drop in the global oil prices due to the increase in production by the OPEC countries. This had a huge impact on the US energy industry. The oil price is projected to stay somewhere at around $50 per barrel

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