{"id":257957,"date":"2024-08-31T21:56:15","date_gmt":"2024-08-31T21:56:15","guid":{"rendered":"https:\/\/michigandigitalnews.com\/index.php\/2024\/08\/31\/its-almost-as-if-some-people-were-rooting-for-recession\/"},"modified":"2025-06-25T17:11:37","modified_gmt":"2025-06-25T17:11:37","slug":"its-almost-as-if-some-people-were-rooting-for-recession","status":"publish","type":"post","link":"https:\/\/michigandigitalnews.com\/index.php\/2024\/08\/31\/its-almost-as-if-some-people-were-rooting-for-recession\/","title":{"rendered":"It\u2019s Almost as If Some People Were Rooting for Recession"},"content":{"rendered":"

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EJ Antoni (Heritage) is dubious about GDPNow\u2019s (and other nowcasts) regarding Q3 growth. From X aka Twitter<\/a> today:<\/p>\n

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Latest Q3 Nowcasts: ATL 2.5% (2.0% prev) NY 2.49% (1.94 prev) STL 2.05% (1.65 prev) It\u2019s going to take stellar consumer spending numbers for Aug and Sep to make this a reality:<\/p>\n

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I wondered about this, in light of the measured acceleration of real consumption growth (m\/m AR 4.6% in July). GDPNow reports<\/a> nowcasted growth of components, like consumption so one can check the nowcast. GDPNow\u2019s 30 August has a 3.8% q\/q AR growth rate penciled in. What\u2019s the picture look like?<\/p>\n

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Figure 1:<\/strong> Consumption (bold black), GDPNow nowcast as of 30 Aug (blue line), August SPF median (red line), and ARIMA(0,1,0) forecast (blue line), +\/- 1 standard error band (gray lines), all in bn.Ch.2017$, SAAR, log scale. Forecast estimated in log first differences, 2021M07-2024M07. Source: BEA, Philadelphia Fed, Atlanta Fed, and author\u2019s calculations.\u00a0<\/em><\/p>\n

Admittedly, GDPNow\u2019s nowcasted consumption is above the August SPF median (although this forecast was generated in early August). However, based entirely on a simple autoregressive model, 3.8% q\/q AR consumption growth would not be surprising at all, statistically speaking.<\/p>\n

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