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Goldilocks Rules! Strong GDP growth, solid consumer demand and tame inflation today confirm US economy in sweet spot

May 30, 2019

Better Data for Better Investment DecisionsBetter Data for Better Investment Decisions
Better Data for Better Investment DecisionsBetter Data for Better Investment Decisions

 

The US government released revised data today on first quarter economic performance that confirmed the Goldilocks scenario persists: strong growth, solid demand and very tame inflation

 

  • First quarter GDP was revised to 3.1%, down from 3.1% and above the 3% revision expected
    • The GDP data is inflation adjusted
  • Consumer Spending grew 1.3% in the first quarter, revised up from 1.2%; no revision was expected
    • This consumer spending growth is solid though the lowest in a year
  • Final sales to domestic consumers grew at 1.5%, revised up from 1.4%
    • This was the slowest since mid-2015
  • The Personal Consumption Expenditures (PCE) index ex-food and energy, the Fed's preferred metric on inflation, was revised lower to 1% from 1.3%
    • The Fed's target is 2% for the PCE index
  • Those who see a glass half full see a strong economy on good footing to face the trade tensions with China that are growing daily
  • Those who see a glass half empty see an economy that may be trending lower if some if the trends seen in this data continue
  • Count us as glass half full people 

 

 

We Crunch the Numbers, You Make the Trade.We Crunch the Numbers, You Make the Trade.
We Crunch the Numbers, You Make the Trade.We Crunch the Numbers, You Make the Trade.

 

US Real GDP Growth q/q, 3 Years

US real gdp

 

 

 

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