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Hurricane -- it's certainly driving the commodities markets this week but -- storm have a wider economic impact joining us now Scott Brown bring in James he's the chief economist there.
-- great -- with us.
I six officially a -- what your thoughts on an economic impact.
-- it's not going to be especially large you know when you look at the big economic effects of hurricanes you're typically talking about.
And Andrew or Katrina.
Category five hurricane hurricane where the wind speeds are probably twice is as much as they are with a category one or two.
So -- maybe some short terms of disruptions in terms of retail sales to get some stocking of supplies ahead of the -- the hurricane.
And then law obviously when -- hurricane this is passing through.
There may be some rebuilding -- it you know it's it's not going to be sufficient enough to even show up in the GDP statistics for example.
The hurricane center is calling for six to twelve foot storm surge and I'm not.
A weather expert but that that's sounds horrifying and it can do some significant damage to that northern Gulf Coast -- -- they updated the levees around New Orleans after Katrina.
I guess put that against the backdrop of the consumer confidence data we got it right which was down.
-- have all this information hitting people and then you almost have a self fulfilling prophecy now.
Well you'll have some some damage certainly I don't wanna down play the the loss of life perhaps or -- the physical damage to to buildings and homes and so on.
But compared to the overall size of GDP again it's not going to be a lot and I what I think that we do expect to see is an increase in gasoline -- -- As the -- oil wells are shut down.
And that can also have a negative effect on on consumer confidence.
We have or gasoline prices peaking around early April and then coming down and that really helped boost consumer spending growth.
In July but those gasoline prices have moved -- higher now and as such I think we're gonna see more restraint on consumer spending I mean.
The analysts are calling -- another ten cents on the retail gallon of gas possibly because of the storm.
70% of gulf oil production shut down 48%.
Of natural gas facilities are down.
On energy prices and then ultimately consumer spending.
Well on the energy prices yesterday it's typically -- short term phenomenon that is once the hurricane passes they they get the oil back flowing again.
So you wouldn't expect prices to remain permanently higher just because of the hurricane unless there's some some physical damage.
Actually the wells.
-- got -- thanks so much appreciate your insights.