GDP tracking: US data not positive for Q2 – Nomura
Analysts at Nomura offered their GDP tracking update after today’s US data.
Key Quotes:
“In terms of GDP accounting, the relevant components of the durable goods report were negative for Q2 GDP tracking. Core capital goods shipments, which are a proxy for business equipment investment, rose moderately by 0.3%, but the March reading was revised lower to -0.3% from +0.5%, lowering the jumping-off point for business investment for Q2.”
“Elsewhere, durable goods inventories—an input for inventory investment of GDP—continued to decline, whereas we had expected a slight increase. Pending home sales, on the other hand, jumped strongly in April, suggesting better existing home sales in the coming months. This should boost real estate broker commissions, a component of residential investment. All things considered, our Q2 GDP tracking estimate was revised down by 0.1pp to 2.4%, from 2.5% previously.
On our Q1 GDP tracking estimate, the downward revision to core capital goods shipments for March was slightly negative. As a result, we also revised down our Q1 GDP tracking estimate by 0.1pp, to 0.8% from 0.9% previously.”
Source:: FX Street
