5 Items to Look Out for When the GDP is Announced
Top GDP Stats to Look for
- The offset of the loss in GDP in the first quarter with second quarter growth. During the first quarter of 2014 GDP declined by 2.9%. During the second quarter of 2014, the GDP was forecasted to grow by 3%. However in an advanced estimate that was released today, it showed the GDP actually increased by 4% These two quarters essential have left the economy flat for the first six months of 2014.
- What are consumers up to? Discretionary purchases and household spending represent about two thirds of the economy. Depending on consumer sentiment could foreshadow increases in demand which was necessary because the first quarter of 2014 demand increased by 1%. The government blamed the lack of consumer confidence on the “Polar Vortex” or bad weather.
- Business inventories; how high or low are they? In the first quarter they rose by 1.7% which means goods were not being shipped. Unless this trend has been reversed it could spell trouble for business sales and consumer confidence.
- Will the Government revise their numbers? Should the government increase the negative growth percentage for the first quarter of 2014 it could have negative implications for the balance of 2014. If the revise it in a positive manner it will yield positive results for growth for the balance of the year.
- If GDP increases beyond the forecast of 3% then there is a chance that business confidence has increased as well. This translates into higher production rates and hopefully increased sales and employment.