The Atlanta Fed GDPNow model took a dive today. The New York Fed Nowcast model will likely do so tomorrow.

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2018 is 1.5 percent on February 14, down from 2.7 percent on February 6. After this morning's retail sales and retail inventories releases from the U.S. Census Bureau, the nowcast of fourth-quarter real personal consumption expenditures growth fell from 3.7 percent to 2.6 percent, and the nowcast of the contribution of inventory investment to fourth-quarter real GDP growth fell from -0.27 percentage points to -0.55 percentage points.

The reason for the plunge is Shockingly Weak Retail Sales: Down 1.2% in December, Sharpest Decline Since 2009.

The Census bureau also posted inventory data today but it is for November. The bureau will not post December inventory data until March 11, and that is after the BEA will release the first and second estimates of GDP on February 28.

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GDP Pot Shot

This is part of the GDP Pot Shot I mentioned on February 8 and February 9.

More so than usual, expect a GDP Pot Shot on Feb 28, as Not All Inputs Finalized.

  • Construction spending, international trade, and inventories are GDP inputs.
  • The BEA will run with the advance trade, wholesale and retail inventory indicators released on February 27 rather than full reports.
  • New home sales for December as well as construction appear to be complete pot shots. Those reports come out after the GDP estimate.

Mike "Mish" Shedlock

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.

GDP Estimates Crash on Dismal Economic Reports

GDP Estimates are well below 1.0% following industrial production and retail sales estimates.

GDP Forecasts Slide on Final Data, GDPNow 3.8%: ZeroHedge 4.4%, Mish 3.4%, More

The BEA provides its first estimate of 2nd-quarter GDP on Friday. Expectations fell due to unexpectedly weak data Thurs.

GDPNow Estimate Tumbles on Weak Retail Sales

The GDPNow forecast fell from 2.3% to 1.8% this week on weak retail sales. The Nowcast estimate rose 0.1%.

Despite Robust Retail Sales, the GDPNow Forecast of Third-Quarter GDP Declined

On Friday, GDPNow lowered its third-quarter GDP estimate from 2.3% to 2.0%

GDP Estimates Dive Following Trade and Income Data

GPD estimates generally tanked this week. Curiously, the Nowcast forecast rose. I can show why.

Fourth-Quarter GDP Final Estimate Hits 2.9%,Tops Consensus

The third estimate of fourth-quarter GDP is 2.9%, up 0.4 percentage points from the second estimate.

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%.

UK Retail Sales Plunge Most Since March of 2009

Additional cracks are starting to appear in the global economy. In the UK, retail sales plunged the most in eight years. Consumers are also becoming worried about falling house prices. I propose consumers should have been worried that home prices would tank long ago.