JPM Cuts Q1 GDP Forecast To Just 0.3%

Tyler Durden's picture

While we wait to see if the Atlanta Fed will cut its final Q1 GDP estimate ahead of tomorrow's official print to 0% or negative, here comes JPM which after slashing its Q1 GDP tracker from 0.6% to 0.4% yesterday, having started the quarter - like most others on Wall Street - at 3%, just trimmed its Q1 GDP estimate to the lowest yet, at just 0.3%.

Here is the full note from JPM's Daniel Silver

We now believe that real GDP increased 0.3% saar in 1Q. This incorporates the various source data that were released this morning as well as a correction to our treatment of the annual revision to the retail sales data that was released yesterday. The updated details of our forecast are in the table below.


In terms of the retail sales data, it appears that this year the BEA will not incorporate the updated figures until the May GDP report, so this Friday’s GDP release will be based on an older vintage of retail sales data. Reverting to the older data, we think Friday’s GDP report will show real consumption at 0.9% saar.


Turning to today’s reports, the flurry of information was a negative for 1Q growth on net, mainly through the inventory components. Wholesale inventories declined 0.1% in March, retail inventories increased 0.4%, and durable manufacturing inventories ticked up 0.1%. These figures continued what has been a weak run for much of the inventory data, and we now think that the real change in inventories in 1Q will actually be negative (at -$2bn saar). This very weak inventory figure expected for 1Q should be a positive development for 2Q growth, but we hold our 2Q growth forecast at 3.0% saar.


Separately, the nominal goods balance widened from -$63.9bn to -$64.8bn in March, with declines in both exports (-1.7%) and imports (-0.7%) during the month. This was slightly less widening in the deficit than we had been expecting for the month and it looks like net exports will be a small positive for growth in 1Q. However, the trade report did have some negative implications for equipment spending, and we now think that real equipment spending increased 5.2% saar in 1Q despite a modest upside surprise on the core capital goods shipments data that were also released today. Core capital goods orders and shipments have both been trending higher lately, with the latest figures showing core orders up 0.2% in both February and March and core shipments up 0.4% in March after a 1.1% gain in February.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
NoDebt's picture

So when it prints at 0.5% it's a "beat".

Is there anyone else here so damned tired of the laughably transparent manipulation tactics you wonder why they even bother trying it at all any more?


Dr. Richard Head's picture

British Prime Minister Benjamin Disraeli: "There are three kinds ofliesliesdamned lies, and statistics."

FrozenGoodz's picture

Fed sits on hands in June, we buy the dip, mas ATH's? 


Blindly buying has been the strategy of the year


Maybe Dartman's even made some money ... short lumber in terms of soy beans or somethin

PrayingMantis's picture


... and compare that to China's Q1 GDP for 2017 @ 6.9% ... >>> ...

   ... how can USA compete on the world stage? ...


... oh yeah, I forgot ... they'll just push the military budget to the hilt and bomb the shit out of non-RedShield-aligned countries ... that's how ... silly me ...



JRobby's picture

- 0.3%


"What!!!!!??????? Well all the payments for Obamacare were mailed in on April 18th. Then the Treasury has to pay them out to the healthcare insurers."

"Can't they accrue the income!?!?!? The GOVT doesn't know how to do proper accounting you silly shit!!!!"

jus_lite_reading's picture

Daniel Silver, registered Democrat, NY NY

I think that says everything we need to know as today, EVERYTHING IS ABOUT POLITICS, NOT TRUTH.

order66's picture

Just means they're going to release a bogus number to get a beat.

Ricki13th's picture

My thinking exactly lower GDP expectation closer to reality and release the most inflated number like 1.3% or so and call it a massive beat just like earnings that ''beat'' weak EPS.


0% interest rate policy and 0% GDP. Good times

JRobby's picture

Yup, like a fart that won't "air out" of the room.

RawPawg's picture


yeah,i still say it...just for old times sake

whatamaroon's picture

The race to the bottom, sad.

Yen Cross's picture

  Pending home sales also in the crapper -0.8%.  Ha

mily's picture

Expectation was -1% so it's a beat...

bogdan11's picture

Yes, but it a was a ''beat'', they wee expecting -1%, bullish, LOL.

PontifexMaximus's picture

The lower the better for the markets

Snaffew's picture

right...and the markets keep climbing...bad news is always good news for equities and good news is always great news for equities.

Jtrillian's picture


kenny500c's picture

I guess the 1,000s of stores closing or the bloated car dealers have no need to build inventory.

JailBanksters's picture

Just a TAD more optimistic than the Club FED then

At least they concur it's goings to Hell in a Handcart

orangegeek's picture



Do I hear 0.1%?????




You know they are lying at 0.3% - it's much worse.


Negative GDP and market ATHs - make it happen yellen ya fucking cunt!!!!

Muppet's picture

Bullish news.  Obvious signal that things can only go up from here.   Better buy now during this dip.

Goldbugger's picture

Stellar growth. Lie and deny till the whole thing crashes but keep pumping the nose bleed equities.