Monthly GDP was flat in September for the third consecutive month. The August reading was revised down from a previously estimated 0.3% increase. Underlying the September reading were large increases in PCE and nonresidential fixed investment (both reflecting a surge in vehicle sales) offset by a large decline in nonfarm inventory investment (reflecting both the surge in vehicle sales and hurricane disruptions). The level of GDP in September was roughly equal to the third-quarter average and consistent with our latest estimate of 2.7% GDP growth in the third quarter. Click here for more information on MA’s Monthly GDP measure.
Monthly GDP rose 0.3% in August following a flat reading in July that was revised up one-tenth. The increase in August reflected positive contributions from nonfarm inventory investment and net exports that were partially offset by a negative contribution from domestic final sales. The level of GDP in August was 3.8% above the second-quarter average at an annual rate, indicating the US economy was benefiting from solid momentum prior to Hurricanes Harvey and Irma. Our latest forecast of 2.7% GDP growth in the third quarter assumes a 0.5% (monthly rate) decline in September, reflecting our assumptions for the effects of the hurricanes. Click here for more information on MA’s Monthly GDP measure.