The GDPNow Forecast jumped 0.6% today, but 0.5 percentage points was an inventory adjustment.

The GDPNow assessment of real final sales, the bottom-line measure of the economy, is only 1.2%, up 0.1 percentage points from a week ago.

GDPNow Latest Forecast: 2.4 Percent - March 29, 2018

  • The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2018 is 2.4 percent on March 29, up from 1.8 percent on March 23.
  • The forecast of the contribution of inventory investment to first-quarter real GDP growth increased from 0.66 percentage points to 1.21 percentage points after yesterday’s advance releases of wholesale and retail inventories by the U.S. Census Bureau, yesterday's GDP release by the U.S. Bureau of Economic Analysis (BEA), and this morning's release of the revised underlying detail tables for the National Income and Product Accounts by the BEA.

Advance Economic Indicators

Yesterday, the Census Department posted Advance Reports (preliminary) on U.S. International Trade in Goods, Wholesale Inventories and Retail Inventories.

I commented on the trade aspect in Trade Deficit Widens Again: Expect More Trump Howls. Here are the other components.​

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Wholesale inventories are up 1.1%. Retail inventories are up 0.4%. Meanwhile, consumer spending is faltering as noted earlier today in Consumer Bites the Dust in First Quarter.​

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In nominal terms, consumer spending was up 0.2% in both January and February. The inventory numbers are nominal as well.

Unless there is a pickup in consumer spending, manufacturers are ramping up production for consumer spending that will not happen.

It is too early to say the consumer has thrown in the towel for good as one quarter proves little. But if the consumer did throw in the towel, there's a clear problem on the horizon, on many fronts.

Mike "Mish' Shedlock

Email Exchange With GDPNow Creator Pat Higgins on GDP Inventory Adjustments

GDPNow forecasts an inventory adjustment of -1.09 percentage points this quarter. What's going on?

GDPNow vs Nowcast: Bit of Convergence but Inventory Problem Looms

The Atlanta Fed GDPNow forecast came out yesterday, the New York Fed Nowcast today.

GDPNow Forecast Up Huge on Positive Economic Data

The Atlanta Fed GDPNow Model forecast for 4th-Quarter GDP jumped strongly today on economic reports since November 19.

GDPNow Forecast Dips to 1.3 Percent: One Heck of an Inventory Adjustment

The GDPNow and Nowcast forecasts are in alignment but the details and implications are not the same.

Inventory Adjustment Add 2 Percentage Points to GDPNow Estimate

The gap between GDPNow and Nowcast is 2.6 percentage points, the widest ever. Inventories pad the GDPNow estimate.

GDPNow and Nowcast Head in Opposite Directions on Trade Data: Pot Shot Coming Up

The latest GDPNow forecast was on Feb 6 and Nowcast was on Feb 8. The reaction to the same trade release is interesting.

GDPNow vs Nowcast Gap Widens Again, Huge GDPNow Inventory Contribution

The Atlanta Fed GDPNow Model Forecasts 4.2% GDP Growth. Nowcast is 2.3%. Inventories contribute 2.2 % to GDPNow.

GDPNow Forecast Dips to 2.3%: Real Final Sales 1.3%

The discrepancy between GDPNow and Nowcast widened again. Importantly, GDPNow forecasts real final sales of just 1.3%.

Pat Higgins Explains the Wild 5.4% GDPNow Forecast Made February 1

The GDPNow model forecast jumped to 5.4% on February 1, only to come crashing down the next day.