Auto Sales Seen Buoyed by Low Rates in U.S., Dealer Group Says

The National Automobile Dealers Association predicts the Federal Reserve will hold off on raising interest rates through the summer, giving vehicle sales a boost that can offset slow economic growth in the start of the year.

Weak economic growth in the first quarter indicates that the Fed will maintain rates until September, Steven Szakaly, NADA’s chief economist, said Monday on a conference call. U.S. gross domestic product for the period will probably rise 2.1 percent, he said, which led NADA to reduce its 2015 forecast for GDP growth to 2.9 percent from 3.1 percent. Still the group maintained its sales forecast for the year, anticipating that interest rates will remain low.