The 2017 economic growth forecast remains unchanged at 2.2 percent following expected offsetting hurricane-related impacts to GDP growth in the third and fourth quarters, according to the Fannie Mae Economic and Strategic Research (ESR) Group’s October 2017 Economic and Housing Outlook.

For the third quarter, it is likely that consumer spending growth weakened and residential investment declined sharply, partially offset by gains in business equipment investment, inventory investment and trade.

The hurricanes appear to have dragged on home sales while also confusing the employment picture due to conflicting messages between the headline and details of the September jobs report. Looking toward 2018, the ESR Group expects economic growth to moderate to 1.8 percent, with upside risk from potential tax reform and downside risk from restrictive trade policy and geopolitical tensions.

“The impacts from this season’s hurricanes on the U.S. economy were wide-ranging but should dissipate over time. These include the loss of momentum in consumer spending and residential investment, as well as a decline in September payrolls and August home sales and contract signings,” Fannie Mae Chief Economist Doug Duncan said in a statement. “We expect economic activity to rebound in coming months. The recovery will likely be slower for home sales and homebuilding, however, as the labor shortage and rising material prices will likely worsen after the hurricanes, exacerbating already-tight inventory.”