<o.t.> G'day all - Mike, the real numbers are out... from Bridge News
B] US GDP Analysis: Q4 PRODUCTIVITY likely to be revised UPWARD!
Updated Fri Feb 26, 1999 13:30 GMT
By Mark Serlin, Bridge News
Washington--Feb 26--Perhaps the most noteworthy point of the Q4 GDP revision is the fact that the output measure used to calculate nonfarm productivity was revised sharply higher (to +7.7% from +6.9%), and is likely to result in an even higher estimate of Q4 productivity.
Specifically, assuming no change in the Q4 hours worked data, the upward revision to Q4 output should result in an upward revision to Q4 productivity toward +4.6% from the initial (and already strong) estimate of +3.8%. That productivity strength will be well received by the Fed, which is betting that strong productivity growth will offset the potentially inflationary implications of the tight labor market.
Also favorable for the inflation outlook were downward revisions to the chain type price indices for overall GDP, final sales, gross domestic purchases, and final sales to domestic purchasers.
Overall Q4 GDP was revised to +6.1% from +5.6%, and real final sales were revised to +6.5% from +6.0%. Those revisions are right in line with the following monthly source data released after the first look at Q4 growth.
goods exports: $1.5 bln more than Commerce assumed
goods imports: $8.2 bln less than Commerce assumed
retail inventories: $5.9 bln more than Commerce assumed
core retail sales: $1.7 bln more than Commerce assumed
wholesale inventories: $2.6 bln more than Commerce assumed
manufacturing inventories: $14.0 bln less than Commerce assumed
core manufacturing shipments: $0.4 bln less than Commerce assumed
1-Unit structures: $0.1 bln more than Commerce assumed
2+ unit structures: $0.1 bln more than Commerce assumed
non-residential structures: $1.9 bln more than Commerce assumed
state and local government: $0.1 bln less than Commerce assumed
That is, consumer spending made a positive contribution of 3.2 percentage points (from the initial estimate of 3.03). Non-residential structures made a contribution of +0.23 pp (from +0.16 pp), inventories made a contribution of -0.36 pp (from -0.31), exports made a contribution of +2.05 pp (from 1.94 pp), imports made a contribution of -1.59 pp (from -1.96), residential investment made a contribution of +0.46 pp (from +0.44), and PDE made a contribution of +1.46 pp (from the initial estimate of +1.57).
Net, were continue to have faster-than-sustainable growth with little inflation.
But what is going on with that Chain Deflator?
best, Bosco |
