Tuesday, October 29, 2019

"How Low Will GDP Growth Be In Q3 2019?"

Gross Domestic Product, 3rd quarter 2019 (advance estimate) October 30 08:30 AM

First up, from Upfina, October 21:
The very solid August retail sales report was revised higher which is the good news from this latest update. Headline monthly growth was revised from 0.4% to 0.6% which is very strong. Yearly real growth was 2.56% which was the highest since August 2018; yearly nominal growth was 4.36% which was the highest since October 2018. As you can see, both were the strongest of the year. The September report wasn’t as great as it missed estimates widely and growth fell. It was still a solid report as both real (2.34%) and headline (4.1%) yearly growth were the second highest since August and October 2018.

Specifically, headline monthly growth was -0.3% which missed estimates for 0.3%. We call this a negative report because the miss was greater than the positive revision. Retail sales without autos fell 0.1% which missed estimates for 0.2% growth. Retail sales growth was driven lower by the motor vehicles and parts segment as we will get to later.

Excluding autos and gas, sales growth was 0% which missed estimates for 0.3%. The reading and the consensus were the same for the control group which goes right into the GDP report. The weakness in control group growth was expected because of the ridiculously high growth earlier this summer. Month over month annualized growth has been 10%, 3.9%, and 0.5% in the past 3 months. The chart below shows quarter over quarter annualized growth fell to 6.8%. That’s similar to the recent decline in PCE growth. The September PCE report comes out on October 31st. ...
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And from the Federal Reserve Banks of New York:
Oct 25, 2019: New York Fed Staff Nowcast
  • The New York Fed Staff Nowcast stands at 1.9% for 2019:Q3 and 0.9% for 2019:Q4.
  • News from this week's data releases left the nowcast for 2019:Q3 broadly unchanged and decreased the nowcast for 2019:Q4 by 0.1 percentage point.
  • Negative surprises from manufacturing data accounted for most of the decrease for 2019:Q4.
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And Atlanta:
Latest forecast: 1.7 percent — October 28, 2019

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2019 is 1.7 percent on October 28, down from 1.8 percent on October 24. After this morning's Advance Economic Indicators report from the U.S. Census Bureau, the nowcast of third-quarter real gross private domestic investment growth decreased from 0.0 percent to -1.3 percent, and the nowcast of the contribution of net exports to third-quarter real GDP growth increased from -0.41 percentage points to -0.26 percentage points....
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