Atlanta Fed US GDPNow Q4 estimate rises to 3.0%

• GDPNow estimate for the fourth quarter jumps to 3.0% from 2.4%
• Forecast boosted by strong November retail sales
• Economic growth in 2018 tracking at 3.23%

The Atlanta Federal Reserve updated its GDPNow model of US economic growth in the fourth quarter to 3.0% from 2.4% on December 7th.  The report cited a stronger estimate for fourth quarter real personal consumption expenditures that climbed to 4.1% from 3.3% following today’s retail sales and industrial production numbers. 

The ‘retail sales control group’  which is included in GDP calculations  surged 0.9%, more than double the 0.4% estimate and  the prior month also was sharply higher after revision to 0.7% from 0.3%. This category excludes motor vehicles, building material gasoline and food service sales. Overall November retail sales increased 0.2% as did the ex-autos number, both as predicted. These figures were weakened by the decline in energy costs. Retail sales are not corrected for prices changes. Annual sales rose 4.22% increased 4.22% and October’s yearly rates climbed to 4.80% from 4.57% following adjustment. 

Industrial production rose 0.6% last month twice the prediction though October’s 0.1% gain was revised to -0.2%.