There was much excitement when just two months ago, the Atlanta Fed revealed that its original Q3 GDP "nowcast" was showing an economy growing at a whopping 3.8% - a welcome reprieve for an economy which has barely been able to "rise above" a stall speed 1% GDP in the first half. Alas, since then things have deteriorated, and quite rapidly in recent days, because just one week after the Atlanta Fed slashed its GDP estimate to a series low of 2.1%, moments ago it just took it down to even less, or the lowest it has been to date, a paltry 1.9% and 50% lower than the original estimate.
Incidentally, after today's major miss in the retail sales control group, this was expected.
At what time does the Atlanta Fed cut its Q3 GDP tracker to 2.0% or lower— zerohedge (@zerohedge) October 14, 2016
The answer: just about an hour later when the Atlanta Fed said the following:
The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2016 is 1.9 percent on October 14, down from 2.1 percent on October 7. The forecast of third-quarter real personal consumption expenditures growth fell from 2.9 percent to 2.6 percent after this morning's retail sales report from the U.S. Census Bureau.
Putting the Atlanta Fed forecast in the context of the entire sellside, we get this:
So taking all the data we have on hand as of this moment, which includes actuals of 0.8% and 1.4% for Q1 and Q2 GDP, together with the Atlanta Fed's 1.9% for Q3 and adding the latest estimate of Q4 GDP by the NY Fed, which as of this moment is 1.6%, we get that the US will grow at just 1.4% in 2016.
Good luck with that rate hike Janet in a year in which the US economy will grow at the slowest pace since the financial crisis.