On February 1st, The Atlanta Fed's GDPNOW model forecast Q1 GDP growth in the US economy would be 5.4%... and the world (on the right) celebrated.
As a reminder, that was the highest GDP forecast by the Atlanta Fed going back to Q1 2012:
We warned at the time that GDPNOW tended to drift lower after an exuberant open... and sure enough, less than a month later, things have gone downhill fast!
As of today, the latest forecast from The Atlanta Fed is just 2.6% GDP growth - a 52% tumble in expectations since the start of the month...
After this morning's Advance Economic Indicators and durable manufacturing reports from the U.S. Census Bureau, the nowcasts of the contributions of real nonresidential equipment investment and real inventory investment to first-quarter real GDP growth declined from 0.45 percentage points and 1.20 percentage points, respectively, to 0.37 percentage points and 0.95 percentage points, respectively. The nowcast of first-quarter real residential investment growth declined from 0.6 percent on February 16 to -4.5 percent on February 26 after housing market releases from the Census Bureau and the National Association of Realtors.
And now below the concensus blue-chip estimate.
None of this should be a surprise - as this has been the pattern of the GDPNOW model's trajectory for multiple years - and in fact this level of GDP growth is equal to the growth seen in Q1 2017 on its way to new lows...