The GDPNow forecast jumped 0.6 percentage points this week, but nearly all of it was inventories. The Consumer has died.
The GDPNow Forecast jumped 0.6% today, but 0.5 percentage points was an inventory adjustment. The GDPNow assessment of real final sales, the bottom-line measure of the economy, is only 1.2%, up 0.1 percentage points from a week ago.
GDPNow Latest Forecast: 2.4 Percent – March 29, 2018
Advance Economic Indicators
Yesterday, the Census Department posted Advance Reports(preliminary) on U.S. International Trade in Goods, Wholesale Inventories and Retail Inventories.
I commented on the trade aspect in Trade Deficit Widens Again: Expect More Trump Howls. Here are the other components.
Wholesale inventories are up 1.1%. Retail inventories are up 0.4%. Meanwhile, consumer spending is faltering as noted earlier today in Consumer Bites the Dust in First Quarter.
In nominal terms, consumer spending was up 0.2% in both January and February. The inventory numbers are nominal as well.
Unless there is a pickup in consumer spending, manufacturers are ramping up production for consumer spending that will not happen.
It is too early to say the consumer has thrown in the towel for good as one quarter proves little. But if the consumer did throw in the towel, there’s a clear problem on the horizon, on many fronts.