Fannie Mae held its growth expectations at 2% for the year despite the slowdown in the first quarter, according to its May 2017 Economic and Housing Outlook.

First quarter growth slowed in 2017 from the previous quarter for the fourth consecutive year, partially reflecting ongoing seasonality issues, according to the report.

“Once again, our full-year growth forecast remains intact as the economy grinds along, with the prospect of material policy changes appearing to be delayed,” Fannie Mae Chief Economist Doug Duncan said.

New data shows, however, that consumer spending growth is set to pick up in the second quarter, the report predicts.

And despite the general economic slowdown, housing remained solid during the first quarter, giving a solid start to the spring home-buying season. Housing inventory, however, continues to decrease affordability.

“However, the tight supply of homes for sale continues to act as both a boon to home prices and an impediment to affordability,” Duncan said.

The tight labor market is expected to continue and Fannie Mae continues to predict the Federal Reserve will raise rates in June and September.

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