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Thursday, October 25, 2012

Friday: Q3 GDP

by Calculated Risk on 10/25/2012 09:06:00 PM

Expectations for Q3 GDP are pretty low ... and moving lower. From the WSJ: GDP Estimates Move Lower Following Durables Report

The consensus estimate of economists surveyed by Dow Jones Newswires is that Friday’s report will show the economy grew at a seasonally adjusted annual rate of 1.8% in the July-to-September quarter. But after Thursday’s figures on business investment, some economists said they are bracing for a weaker GDP report than the consensus figure.

Wells Fargo — pointing out that shipments of core capital goods fell at an annual pace of 4.9% over three months — lowered its estimate of third-quarter GDP growth to an annual rate of 1.4% from 1.6%. J.P. Morgan Chase lowered its forecast to 1.6% from 1.8%.

“The downside risks are mounting to our already below-consensus estimate that GDP increased by only 1.3% in the third quarter,” Paul Ashworth, chief U.S. economist at London-based Capital Economics, said in a note to clients. “At 1.8%, the consensus forecast looks way to high.”
• At 8:30 AM ET, the advance release for Q3 GDP will be released by the BEA. The consensus is that real GDP increased 1.9% annualized in Q3.

• At 9:55 AM, the Reuters/University of Michigan's Consumer sentiment index (final for October). The consensus is for no change from the preliminary reading of 83.1.

Another question for the October economic prediction contest (Note: You can now use Facebook, Twitter, or OpenID to log in).