The discrepancy between GDPNow and Nowcast widened again. Importantly, GDPNow forecasts real final sales of just 1.3%.
The divergence between the Atlanta Fed GDPNow Model and the New York Fed Nowcast Model widened again this week.
GDPNow Latest Forecast: 2.3 Percent – April 5, 2018
Nowcast Latest Forecast: 2.8 Percent – April 5, 2018
The New York Fed Staff Nowcast stands at 2.8% for 2018:Q1 and 2.9% for 2018:Q2.
The nowcast for 2018:Q1 moved up by 0.1 percentage point. This increase was largely due to parameter revisions.
The nowcast for 2018:Q2 was broadly unchanged. The positive impact of parameter revisions and a positive surprise from the ISM Prices index were mostly offset by negative surprises from nonfarm payroll employment and the ISM Employment index.
Real Final Sales
The real final sales estimate is the true bottom-line estimate of the economy. It excludes changes in inventories which net to zero over time.
At 1.3% real final sales are close to the the bottom of the range for this entire series, having been as high as 4.1% on February 1.