2018 Economic Calendar
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Released On 2/28/2018 8:30:00 AM For Q4(p):2017
PriorConsensusConsensus RangeActual
Real GDP - Q/Q change - SAAR2.6 %2.5 %2.3 % to 2.6 %2.5 %
GDP price index - Q/Q change - SAAR2.4 %2.4 %2.4 % to 2.4 %2.3 %
Real Consumer Spending – Q/Q change – SAAR3.8 %3.7 %3.6 % to 3.7 %3.8 %

There's very little change between the second and first estimates for fourth-quarter GDP, revised 1 tenth lower to an as-expected 2.5 percent annualized rate. Consumer spending is unchanged at a very strong 3.8 percent as downward revisions to spending on durables (down 4 tenths to a 13.8 percent rate) and nondurables (down 9 tenths to 4.3 percent) are offset by an upward revision to the largest category of service spending (up 3 tenths at 2.1 percent).

Residential investment gets a noticeable upgrade to a 13.1 percent rate from 11.6 percent in the first estimate while nonresidential investment is lowered by 2 tenths to 6.6 percent. These are both very solid and, like consumer spending, point to fundamental economic demand. Net exports are virtually unchanged in today's revisions, at a very sizable $652.2 billion and pulling down the quarter's headline GDP rate by 1.1 percentage points. Inventories are also a negative, slowing in the quarter to an $8.0 billion build from $38.5 billion in the third quarter and pulling down the headline by 0.7 points.

Another one of the positives in the quarter is government purchases which are revised marginally lower to 2.9 percent. This rate may become a positive wildcard in future quarters given the outlook for increased deficit spending. Another possible positive is inventory growth which is off to a fast start so far this quarter as businesses scramble to restock shelves amid strong demand.

Strength is definitely the message of this report, masked by the nation's trade imbalance and the quarter's inventory change excluding which GDP rose 4.3 percent, a reading that is unchanged from the first estimate. On the inflation front, the GDP price index rose 2 tenths in the quarter to a 2.3 percent rate which is down 1 tenth from the first estimate though the core, however, is revised 1 tenth higher to 2.2 percent which, in a hint of building pressures, marks a 6 tenths acceleration from the third quarter.

Consensus Outlook
The second estimate for fourth-quarter GDP is expected to come in at a 2.5 percent annualized rate vs 2.6 percent in the first estimate. The consumer is still likely to be the driver in the fourth quarter but looks to get trimmed slightly following downward revisions to retail sales. Consumer spending is expected to rise at a 3.7 percent pace vs 3.8 percent in the first estimate. The GDP price index is seen at a 2.4 percent rate.

Gross Domestic Product represents the total value of the country's production during the period and consists of the purchases of domestically-produced goods and services by individuals, businesses, foreigners and government entities. Data are available in nominal and real (inflation-adjusted) dollars, as well as in index form. Economists and market players always monitor the real growth rates generated by the GDP quantity index or the real dollar value. The quantity index measures inflation-adjusted activity, but we are more accustomed to looking at dollar values.

Household purchases are counted in personal consumption expenditures -- durable goods (such as furniture and cars), nondurable goods (such as clothing and food) and services (such as banking, education and transportation). Private housing purchases are classified as residential investment. Businesses invest in nonresidential structures, durable equipment and computer software. Inventories at all stages of production are counted as investment. Only inventory changes, not levels, are added to GDP.

Net exports equal the sum of exports less imports. Exports are the purchases by foreigners of goods and services produced in the United States. Imports represent domestic purchases of foreign-produced goods and services and must be deducted from the calculation of GDP. Government purchases of goods and services are the compensation of government employees and purchases from businesses and abroad. Data show the portion attributed to consumption and investment. Government outlays for transfer payments or interest payments are not included in GDP.

The GDP price index is a comprehensive indicator of inflation. It is typically lower than the consumer price index because investment goods (which are in the GDP price index but not the CPI) tend to have lower rates of inflation than consumer goods and services. Note that contributions of each component, as averaged over the prior year, are tracked in the table below (components do not exactly sum to total due to chain-weighted methodology). Consumption expenditures, otherwise known as consumer spending, has over history been steadily making up an increasing share of GDP.  Why Investors Care
Real GDP growth is always quoted at a quarterly annual rate. It measures how much the economy has grown over a three-month period. Quarterly growth rates are often volatile consequently, economists also like to look at the year-over-year growth in GDP. The yearly changes tend to be more stable.
Data Source: Haver Analytics
It is common to compare quarterly change at annualized rates in the GDP deflator. But these changes can be volatile and mask the trend which, just like the quarterly swings in GDP, is sometimes more visible in year- on-year change.
Data Source: Haver Analytics

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