Q2 GDP report due out Thursday morning

Oops... last week I wrote this post saying that the Q2 GDP report would be out on Tuesday (today), but obviously that is not the case... it is due out on Thursday morning. Sorry about that. As per the BEA (Bureau of Economic Analysis):

Next release--July 31, 2008, at 8:30 A.M. EDT for:
Advance estimate of gross domestic product for
the second quarter of 2008 and annual revision
(first quarter 2005 through first quarter 2008).

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The "advance" report for Q2 GDP will be out Thursday morning. Although there is a very hearty chorus of people who fervantly and passionately believe that the U.S. economy is already in a recession, even the Q2 report is still likley to show real GDP as being at least slightly positive. In fact, Macroeconomic Advisers, who publishes their own estimates of monthly GDP is forecasting real Q2 GDP growth of +2.6%.

Although the NBER Business Cycle Dating Committee, the people who definitively mark the precise month that each recession begins and ends does use monthly GDP data such as from Macroeconomic Advisers, it is only one of five indicators that they examine. Still, it is rather unlikley that a deep recession could occur without showing a big hit to GDP.

Macroeconomic Advisers has released their estimates for April and May GDP (+0.5% and +0.1%), but they won't have a data-based estimate for June and a complete estimate for Q2 until the middle of August. You might ask how the government is going to release Q2 GDP next week then. The answer is that the government is simply extrapolating from April and May and other historical data and trends to contrive temporary numbers for June to get a full quarter of GDP. That is why this is called the "advance" report, since it is in advance of the real data. The government will have the preliminary June numbers in a few weeks and issue the "preliminary" Q2 GDP report at the end of August. Macroeconomic Advisers will have that same June data in a couple of weeks and turn it around more quickly to give us both the June monthly data and a more accurate estimate for Q2 GDP.

Macroeconomic Advisers had forecast 2.9% real GDP growth for Q2 in their last public report, but as of today their web site says that Q2 real GDP growth is "tracking" at 2.6%. In addition, they are saying that Q3 is tracking at 1.4%, which will further disappoint and frustrate the doomsayers. Some of them are already "refining" their recession forecasts out to Q4.

-- Jack Krupansky