Monthly GDP rose 0.3% in August following a flat reading in July that was revised up one-tenth. The increase in August reflected positive contributions from nonfarm inventory investment and net exports that were partially offset by a negative contribution from domestic final sales. The level of GDP in August was 3.8% above the second-quarter average at an annual rate, indicating the US economy was benefiting from solid momentum prior to Hurricanes Harvey and Irma. Our latest forecast of 2.7% GDP growth in the third quarter assumes a 0.5% (monthly rate) decline in September, reflecting our assumptions for the effects of the hurricanes. Click here for more information on MA’s Monthly GDP measure.
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Monthly GDP slipped 0.1% in July following robust increases over the prior two months. The small decrease in July reflected estimated declines in nonfarm inventory investment and net exports that were nearly offset by a solid increase in PCE and smaller increases elsewhere in domestic final sales. The level of GDP in July was 2.4% above the second-quarter average at an annual rate. Implicit in our latest forecast of 3.4% GDP growth in Q3 are increases in monthly GDP in August and September of 0.2% to 0.3% per month (not annualized). Click here for more information on MA’s Monthly GDP measure.
MA’s Chris Varvares, senior managing director at Macroeconomic Advisers, discusses jobs and immigration with Tyler Mathisen and Sue Herera on CNBC’s Nightly Business Report. Click here to watch the video.
Monthly GDP rose 0.4% in June following a 1.1% increase in May that was revised up from a previously reported 0.7% gain. The increase in June was mainly accounted for by estimated increases in nonfarm inventory investment and net exports. Domestic final sales were essentially flat in June, as a solid increase in PCE was offset by decreases in fixed investment and the portion of monthly GDP not covered by the monthly source data. The data on monthly GDP through June are consistent with our latest tracking estimate of 2.9% GDP growth in the second quarter. Click here for more information on MA’s Monthly GDP measure.
Macroeconomic Advisers’ Pre-FOMC Briefing Webinar Thursday, July 20th 10:30 AM – 11:05 AM EST Ken Matheny, senior economist at Macroeconomic Advisers will discuss MA’s views of the policy and economic backdrop for the meeting and our expectations for near-term Fed policy. To find out how to register for the webinar contact Tonya Cooksey by phone (314.721.4747) or email (email@example.com).
MA’s Ken Matheny was quoted in the article, “Boring is best as Fed contemplates smaller balance sheet” by David Nicklaus of the St. Louis Post-Dispatch. (Excerpts shown below.) It was a big deal when the Federal Reserve bought trillions of dollars in bonds to boost the economy. Now that the Fed is about to reverse the process, we’re told it will be about as exciting as watching paint dry. Why the difference? For one thing, we’re not in a financial crisis, and the Fed plans to subtract those trillions more gradually than it added them. So far, markets have reacted calmly as one Fed official after another has discussed the balance-sheet reduction process. “It’s not really going to have a major impact on the outlook for bond yields,” said Ken Matheny, an economist at Macroeconomic Advisers. “Markets should be very well prepared for this, because the Fed has told us … Continue Reading
Macroeconomic Advisers is proud to be recognized by the Federal Reserve Bank of Chicago for The Best Overall Forecast, The Best Current Dollar GDP Forecast, and The Best Inflation Forecast submitted at the 2016 Automotive Outlook Symposium. The highly respected national competition received over 27 entries from the manufacturing and banking industries, as well as consulting and service firms and academia. Winners represent the best work from the most respected forecasting firms and Macroeconomic Advisers is proud to be acknowledged for its accuracy of its macroeconomic forecasts. “We are honored to be acknowledged by the Federal Reserve Bank of Chicago and are proud of the exceptional content created by our forecasting team. We pride ourselves in having the most experienced team of economist focused on U.S. macroeconomics in the private sector. Our economists work assiduously to add value and accuracy through its forecast and market analysis, and to be recognized … Continue Reading
MA’s Ben Herzon was quoted in the article, “US growth rate revised up to 1.2%” by Natalie Sherman with BBC News. (Excerpts shown below.) The US economy grew at a faster pace than initially thought in the first three months of the year. The latest official figures indicated the economy expanded at an annual pace of 1.2% in the quarter, up from the previous estimate of 0.7%. The change came after upward revisions to business and consumer spending. The initial estimate had been seen as a blow to US President Donald Trump, who pledged in his election campaign to raise growth to 4%. However, the revised figure still represents a slowdown from the 2.1% growth rate recorded in the final quarter of 2016. Consumer spending improved from the initial estimate of 0.3%, but growth remained tepid at 0.6%, slower than any quarter since 2009. Ben Herzon, senior economist at Macroeconomic … Continue Reading
MA’s Ben Herzon was quoted in the article, “Markets will be watching economic data and whether Amazon can break $1,000” by Patti Domm with CNBC. (Excerpts shown below). Economists on Thursday slashed second quarter GDP forecasts, based on April trade and inventories data. Many also revised down their forecast earlier this week because of weakness in new home and existing home sales data. But it’s the first quarter that will be in the headlines Friday. The second reading of first quarter GDP is expected to show improvement to 0.8 percent, from 0.7 percent, according to the Rapid Update. “It’s still a slug, but there’s temporary factors at play that we think won’t recur,” said Ben Herzon, senior economist with Macroeconomic Advisers. Weather was a factor as well as a big drop in inventory investment, which he expects to see reverse. He expects to see first quarter GDP unchanged at 0.7 … Continue Reading
Monthly GDP rose 0.1% in April following a 0.1% increase in March, which was as originally reported. The soft April increase reflected a solid increase in domestic final sales that was partially offset by a decline in net exports. Nonfarm inventory investment rose only modestly. The increase in domestic final sales was primarily accounted for by PCE. The level of monthly GDP in April was 1.2% above the Q1 average at an annual rate. Our current forecast of 3.2% Q2 GDP growth assumes a robust increase in May reflecting a sharp increase in nonfarm inventory investment. Click here for more on MA’s Monthly GDP measure.