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US GDP Grows at Faster Pace Than Originally Estimated

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Bloomberg Nov 30, 2023 02:58 · 8624 Views

US GDP rose at an upwardly revised 5.2% annualized pace in the third quarter, the fastest in nearly two years. Consumer spending advanced at a less-robust 3.6% rate, according to the government’s second estimate of the figures issued. Mike McKee reports on "Bloomberg Surveillance."

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Transcript

  • 00:00 What did you make of that?
  • 00:01 The fact that markets really keyed in with Chris Waller and completely ignored Michelle Bowman.
  • 00:05 That's because Michelle Bowman was suggesting what they want to hear that she might not need.
  • 00:10 We might not need to see additional rate increases.
  • 00:13 Chris Waller getting some support from the GDP numbers just out this morning,
  • 00:17 am I right?
  • 00:17 Shocking.
  • 00:19 Shocking.
  • 00:19 Yeah,
  • 00:20 in a way.
  • 00:21 4th
  • 00:22 third quarter GDP revised up to 5.2% from 4.9%.
  • 00:26 That's well above
  • 00:27 the 5% that was thought
  • 00:30 and a lot of that comes from increased business investment which came in pretty low
  • 00:34 in the initial report.
  • 00:36 And so there was that was a bit of surprise, but we're seeing a little bit more
  • 00:40 non fixed non residential investment.
  • 00:43 The
  • 00:44 GDP
  • 00:45 in terms of
  • 00:46 personal consumption however is lower.
  • 00:48 We spent less 3.6%
  • 00:51 compared to 4%.
  • 00:52 Lisa's refrigerator will show up in the fourth quarter.
  • 00:54 I think this is
  • 00:55 true.
  • 00:55 And the GDP price indexes which
  • 00:57 the Fed doesn't really pay attention to because their quarterly averages come in lower than anticipated.
  • 01:04 The
  • 01:05 quarter over quarter PCE price index, the
  • 01:07 core comes in at 2.3%
  • 01:10 compared to 2.4%.
  • 01:12 Now we'll look tomorrow to the PCE numbers to see
  • 01:15 whether we get the same sort of thing.
  • 01:17 Trade deficit widens the advanced good trade balance for October 89.8 billion from 86.9 billion.
  • 01:25 So that's a little bit of a subtraction off of the first month
  • 01:30 of
  • 01:31 the fourth quarter.
  • 01:32 And then inventories come in
  • 01:34 weaker,
  • 01:36 down 2/10 percent on the wholesale level and flat on the retail level.
  • 01:40 That is
  • 01:41 less than what had been anticipated.
  • 01:43 What if we get another
  • 01:44 glorious jobless claims, say under 220?
  • 01:48 I mean, it confirms
  • 01:50 a fully employed America, right?
  • 01:52 Well, it probably mean for market participants that they're going to keep their bets right now that the Fed will start cutting rates by
  • 01:58 the mid part of next year.
  • 02:00 Nobody's seems to be buying into the Bill Ackman argument yet of the
  • 02:04 of the first quarter.
  • 02:05 But
  • 02:06 it's a week from Friday that we really care about in terms of jobs.
  • 02:09 And it'll be interesting because we're in the quiet period then
  • 02:11 and then we also get CPI just before the Fed meeting.
  • 02:14 So two of the biggest
  • 02:17 data releases
  • 02:18 come in the quiet.
  • 02:19 We'll see if they support
  • 02:21 the
  • 02:22 Waller view that the economy is slowing enough to bring inflation down.
  • 02:26 That'll be the key thing, Tom.
  • 02:27 I would point out I know you're a nominal kind of guy.
  • 02:30 Nominal GDP for the
  • 02:32 for the third quarter, the second estimate 8.9%.