GDPNow Nowcast Dips on Weak ISM and Construction Spending

by
Sharing is Caring!

by Mike Shedlock

The GDPNow nowcast fell 0.6 percentage points to 2.5 percent on weaker than expected economic reports.

GDPNow data from the Atlanta Fed, chart by Mish

The Atlanta Fed updated its GDPNow Nowcast on October 1. Here is a recxap.

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2024 is 2.5 percent on October 1, down from 3.1 percent on September 27. After Tuesday’s construction spending release from the US Census Bureau and the Manufacturing ISM Report On Business from the Institute for Supply Management, the nowcasts of third-quarter real personal consumption expenditures growth and third-quarter real gross private domestic growth decreased from 3.3 percent and 2.9 percent, respectively, to 3.0 percent and 0.8 percent.

The number to watch is Real Final Sales not the headline number. The difference between GDP and Real Final Sales is inventory adjustment which nets to zero over time.

Construction Spending

  • The Commerce Department reports construction spending fell 0.1 percent in August.
  • The Commerce Department revised July lower from -0.3 percent to -0.5 percent.
See also  Canada's recession hidden by immigration-driven spending; GDP per capita declines.
See also  The EU is losing its edge in manufacturing to Asia and the US. The EU’s unity is an illusion, with deep divides on energy, immigration, and spending. It’s not a crisis, it’s an implosion.

ISM Manufacturing Contracts 6th Month, 22nd Time in 23 Months

Yesterday, I commented ISM Manufacturing Contracts 6th Month, 22nd Time in 23 Months

Employment fell sharply but production contraction slowed. Prices are declining.

Compared to the typical quarter, the GDPNow nowcast has been in a relatively tight range for the entire quarter.