The case for anticipating slow growth in the third quarter rolls on. Today’s update of The Capital Spectator’s suite of nowcasts for third-quarter real GDP remain steady relative to the previous revisions from September 30. The current numbers incorporate last week’s economic updates for several September indicators, which continue to signal slow growth for the economy (see here and here, for example). The models tell us that when the government releases the official GDP report for Q3 on October 26, the odds still look favorable for expecting that the economy’s real (inflation-adjusted), annualized change will be slightly better than the sluggish 1.3% growth reported for Q3. This outlook is supported by the incoming data for September for estimating the broad economic trend (as we discussed earlier today), which suggests that there’s still forward momentum in the economy overall and that recession risk remains low, given the latest numbers available.
Daily Archives: October 8, 2012
U.S. Economic Trend Update | 10.8.12
The September data published to date suggests that the U.S. economy continues to grow. The expansion remains sluggish, but it’s still growth. Of the eight September indicators published so far for The Capital Spectator Economic Trend Index (CS-ETI), six are trending positive. That implies that recession risk was still low last month. But the reading is based on incomplete numbers. When the remaining indicators for CS-ETI are updated for September, we’ll have a clearer picture of the broad economic trend. For now, the signs look encouraging. One of September’s indicators—the ISM Manufacturing Index—turned positive for the first time since May, as we discussed last week. With that change for the better, and no reversal of fortunes so far in the other indicators that have been updated, September’s profile is slightly brighter than August’s. But with a half-dozen September updates yet to come, it’s best to reserve judgment in the current environment.