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Q3 GDP Forecasts: Downward Revisions

by Calculated Risk on 8/20/2021 11:20:00 AM

From BofA:

3Q GDP growth is currently coming in at 4.5%, leaving annual growth to slip to 5.9% this year. We think the Delta variant is a large reason for the soft patch as can be seen by the pullback in spending on leisure services. But we also have to consider the possibility of more permanent supply-side constraints and greater precautionary savings. [August 20 estimate]
emphasis added

From Goldman Sachs:

We have lowered our Q3 GDP forecast to +5.5%, reflecting hits to both consumer spending and production. Spending on dining, travel, and some other services is likely to decline in August, though we expect the drop to be modest and brief. Production is still suffering from supply chain disruptions, especially in the auto industry, and this is likely to mean less inventory rebuild in Q3. [August 18 estimate]

From the NY Fed Nowcasting Report

The New York Fed Staff Nowcast stands at 3.5% for 2021:Q3. News from this week’s data releases decreased the nowcast for 2021:Q3 by 0.3 percentage point. [August 20 estimate]

And from the Altanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 6.1 percent on August 18, down from 6.2 percent on August 17. [August 18 estimate]

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