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%.
Boosted by upward revisions for inventories and construction, the third estimate for second-quarter GDP is expected to firm slightly, to a consensus 3.1 percent annualized rate vs the headline catching 3.0 percent rate of the second estimate. Consumer spending is expected to hold at the second estimate’s 3.3 percent rate. The GDP price index is seen unchanged at 1.0 percent.
Construction Upgrades?
On August 1, I wrote Construction Spending in June Collapses: Negative Second Quarter GDP Revisions Coming Up?
The commerce department reports Construction Spending in June fell 1.3% vs an Econoday consensus of a 0.5% gain. As a small consolation, the Commerce Department revised May spending from +0.0% to +0.3%.
Consumer Spending
On Friday, September 15, I reported Retail Sales Unexpectedly Decline, Huge Negative Revisions in June and July: Reflections on “Bizarre” Sales Reports
The Census Bureau Advance Retail Trade report shows retail sales unexpectedly fell 0.2% in in August.
More importantly, the Census Bureau revised July from plus 0.6% to plus 0.3%. On top of that, the census bureau revised June from +0.3 to -0.1!
Bloomberg Econoday attempted to whitewash this mess, blaming it all on Hurricane Harvey.
Excuse me for asking but did economists not know there was a hurricane?
At the risk of looking foolish, I will take a stab at 2.5%. A big boost, however, could come from a change in the GDP deflator.
Mike “Mish” Shedlock
If the economy goes down the drain we can always blame the low wage Nomads!
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Down from prior because it’s Trump’s fault.
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If it dips below 3 I wonder if the talking heads will make as big a deal out of it as they did when it went to 3: “See, they said 3% was impossible but MAGA economics proved them wrong!”
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Trump literally just bragged about his 3% quarter again in his Tax reform speech.
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If it comes in at 2.5, you’ll look like a genius, Mish. After looking real hard at 2.6, I’m throwing my guess in at 2.7, but I never was very good at numbers…
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It’s not necessarily a matter of being good with numbers – it’s a crap shoot
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I would like to see an analysis of construction in Mass. I live in Central mass and everywhere I look there is construction, both commercial and residential. Most residential contractors here seem to be running flat out.
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I do not live in MA. Hard to comment. Even if so, it is hugely problematic to look at one area and believe it is indicative of national trends.
If I made the same judgment where I live I would think there is no residential construction and no home resales.
My neighbor has not had a single looker at several open houses. Overpriced? Highly likely.
But I see no residential construction, unlike past years.
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