Q3 2018 US GDP data 26 October 2018
- Q2 4.2%
- Sales 1.4% vs 2.0% exp. Prior 5.4%
- Consumer spending 4.0% vs 3.8% prior
- GDP deflator % vs 2.1% exp. Prior 3.3%
- PCE 1.6% vs 2.0% exp. Prior 2.0%
- Core PCE 1.6% vs 1.8% exp. Prior 2.1%
- Exports -3.5% vs 9.3% prior
- Imports 9.1% vs -0.6% prior
Looks good on the front end but some issues underneath. A big drop in exports and prices looking softer.
Business investment was up 0.8% but far from the 8.7% in Q2. Biz investment in structures was down 7.9% vs 14.5% prior. Home investment dropped 4% vs -1.3% prior.
A real mixed bag. It’s lower GDP but not as much as expected but with some red flags.
A lot is being made about the inventories, which added 2.07 PP to the change in GDP. In real terms it was 76.3bn vs 36.8bn prior. The weather might also have played a part but the commerce dept says it’s not possible to estimate the overall impact.
Psychedelic chartist extraordinaire. Have your shades ready.
Philosophy: “Don’t be a Dick for a tick”
Read how Ryan got into trading here
Philosophy: “Don’t be a Dick for a tick”
Read how Ryan got into trading here
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Not a report to cause a turnaround imo. Consumer spending may still have to do with a buying spree before the tariffs since it’s the full Q3 reading. Lower deflator, lower inflation expectation may bring some early equity rebound with it, but I’m not changing from my short EURJPY view for this reason. I don’t think it’ll last. monitoring each side of the 126.80-127.50/55 for 1/3 of the position.
Not selling USD either as the month end rebalancing should be USD buying looking at the weak Us asset performance in October. EURUSD expecting the 1.1300 test in the making.