The BEA revised its Fourth-Quarter 2017 GDP estimate to 2.9%, topping the consensus estimate of 2.7%.

Rick Davis at the Consumer Metrics Institute provides this summary.

  • The boost in the headline number resulted from upward revisions to contributions from consumer spending (+0.17%) and inventories (also a +0.17% increase, as a result of reportedly slower inventory contractions). No other line items changed materially.
  • The BEA's "bottom line" for the quarter (their "Real Final Sales of Domestic Product", which excludes inventories) increased to +3.41%, up +0.18% from the previous estimate and +1.04% from the prior quarter.
  • Real annualized household disposable income decreased -$2 per year from the previous report to $39,223 (in 2009 dollars). The household savings rate deteriorated to 2.6%, lower than the level recorded in third quarter of 2007 -- at the onset of the "Great Recession."
  • For this revision the BEA assumed an effective annualized deflator of 2.35%. During the same quarter (October 2017 through December 2017) the inflation recorded by the Bureau of Labor Statistics (BLS) in their CPI-U index was a very similar but slightly higher 2.49%. Under estimating inflation results in optimistic growth rates, and if the BEA's "nominal" data was deflated using CPI-U inflation information the headline growth number would have been slightly lower at a +2.82% annualized growth rate.

What Happened?

Hurricane spending undoubtedly boosted fourth-quarter GDP, and consumers had to tap into saving to buy.

Retail sales have not been good so far in 2018 so expect a snapback in the first quarter.

The GDPNOw Real Final Sales estimates for the first quarter sit at 1.1%.

Mike "Mish" Shedlock

Third-Quarter GDP Hits Consensus 3.3% Estimate

The BEA reported the second estimate of third-quarter GDP was 3.3%. The report matched the Econoday consensus.

GDPnow, Nowcast Boost Fourth-Quarter GDP Estimates

GDPNow upped its 4th-quarter GDP estimate to 3.3% from 2.9% a week ago. Nowcast upped its forecast to 4.0% from 3.9%.

2nd Quarter GDP Final Estimate Tomorrow: Up or Down from Prior?

The BEA’s third (final) estimate of second-quarter GDP is due Thursday. The Econoday consensus is the BEA will up the reading to 3.1% from 3.0%.

Final Model Forecasts for First Quarter GDP: GDPNow 2.0%, Nowcast 2.9%

The advance (first) estimate of first-quarter GDP is published tomorrow. The GDPNow final estimate is 2.0%, Nowcast 2.9%

First Estimate of Second-Quarter GDP at 2.1% Topping Consensus

Real GDP at 2.1% topped the consensus estimate of 1.9%, the GDPNow forecast of 1.3, and Nowcast at 1.5% (revised today).

3rd-Quarter Real GDP Rises 1.9%, Near Top of Consensus Range

The BEA reported real GDP rose 1.9% for the quarter in a consensus range of 1.2% to 2.0%.

First Quarter GDP (Final Estimate) 2.0%, a Bit Lower Than Expected

Consumer spending revisions took the 3rd estimate of the 1st-quarter GDP to 2.0% from 2.2%.

3rd Quarter GDP Estimates Collapse

In the wake of today’s economic reports, third-quarter GDP estimates from the Atlanta Fed GDPNow model and the New York Fed Nowcast model each plunged 0.8 percentage points.

First Quarter GDP Second Estimate 1.2 Percent: Mish vs. Consensus

This morning, the BEA revised its estimate of first-quarter GDP to 1.2% from 0.7%. The Econoday consensus estimate was 0.8%, in a range of 0.7% to 1.0%.