Nowcast GDP Forecast Surges, GDPNow Forecast is Down a Bit


The GDPNow and Nowcast GDP forecasts for the first quarter of 2020 converged quite a bit today.

Step Towards Convergence

Whereas the GDPNow forecast fell from 2.3% to 2.1%, the Nowcast forecast jumped from 0.7% to 1.3%.

  • The gaps between the two competing forecasts was 1.6 percentage points a week ago.
  • Today the gap is 0.8 percentage points.

Conversation on the Models

Industrial Production

Convergence is somewhat due to Nowcast delays in factoring in industrial production impacts in the wake of the GM Strike that Ended on

I commented on the bump on December 17: Industrial Production Rebounds after GM Strike Ends.

Looking ahead, Boeing is going to have a significant impact in the first quarter.

Thousands of jobs and possibly as much as 1/3 of a point of GDP as Boeing Will Suspend 737 Max Production in January.

Inventory Analysis

The most interesting aspect of the report is GDPNow sees a first quarter drawdown in inventory but Twitter comments seem to expect an inventory build.

Inventory calculations are a crapshoot even in normal circumstances. They are even more difficult now.

Mike "Mish" Shedlock

Comments (4)

All govt driven 100% and what's the deflator?Ahhh let me guess 1% lol,so big govt borrowing (printing)$300 billion and change a MONTH to drive 1-2%GDP,that's close to 4 trillion yearly deficit,but the "official" deficit is "only"2 tril! Obviously some serious accounting fraud goin on in DC.

No. 1-3

I’m still expecting 1% average annual economic growth through the next decade. A significant recession is unlikely unless some catastrophe occurs. There may be some years in the next decade which will flirt with 0% growth and perhaps some will call those periods recessions.


Quarterly wash, rinse, repeat.

Global Economics