27 March 2015 US Fixed Income Weekly When: are ixe at the moment' The economy is projected to grow 2.4% in O1 2015, nearly the same pace as the previous quarter. The inability of the economy to sustain a 3%-plus growth rate in the first quarter is due to several factors. One, the economy faced an unusually brutal winter for the second consecutive year. Temperatures across much of the country were unseasonably low and activity was hampered by numerous winter storms. This likely depressed discretionary purchases and hurt construction activity. Two, a slowdown in West Coast port activity, a function of labor strife, may meaningfully dent Q1 exports. This will likely reverse next quarter as the labor issues have been resolved. Three, the seasonal factors might not be adequately capturing the currently prevailing seasonal pattern. If our quarterly 2015 GDP profile is correct, this would mark the eighth time in the last 13 years in which O1 turned out to be the weakest quarter of the year. Finally, the collapse in energy prices is causing a sharp pullback in energy-related capital spending at the moment. However, if oil prices stabilize, the drag from diminished oil and gas capital expenditures (capex) should dissipate toward yearend. Based on DB's forecast for West Texas Intermediate oil prices, energy-related capex should show an increase by Q4 of this year. baby, Its cold outside. We can measure weather by looking at the number of heating degree-days relative to the average. When the figure is positive, it means that households had to heat their homes more than normal, and vice versa. As we can see in the accompanying chart, there was a large jump in February 2015 heating degree-days. Indeed, it was the largest positive reading since December 2000, and it was one of the coldest Februarys on record. There is little doubt this had a negative impact on discretionary purchases such as motor vehicles. In fact, various reports among dealerships acr