Friday, April 10, 2009

Monthly GDP for January rose by +0.2% (+2.2% annualized), Q1 tracking for a -5.1% annualized decline

[My apologies for the delay, this data came out on March 17, 2009, but my attention was elsewhere. Monthly GDP for February should be released within about 10 days.]

Monthly real GDP, one of the five primary economic indicators that the NBER Business Cycle Dating Committee (NBER BCDC) uses to judge recession start and end dates, rose modestly in January by +0.2% or +2.2% annualized, after falling sharply by -1.8% in December (revised down from -1.3%), and real Q1 GDP is forecast to decline by -5.1% annualized, according to Macroeconomic Advisers (MA). The government does not publish GDP data at a monthly level, but the NBER Business Cycle Dating Committee says that they refer to sources such as Macroeconomic Advisers (MA) and their MGDP data series. As Macroeconomic Advisers summarized GDP for January:

Monthly GDP rose 0.2% in January.  This followed a 1.8% decline in December that was revised from a 1.3% decline previously.  The small increase in January reflected positive contributions from personal consumption expenditures and inventory investment and negative contributions from capital goods, construction, and net exports.  The January level of monthly GDP was 3.4% below the fourth-quarter average at an annual rate.  Average monthly declines of 0.4% in February and March would be consistent with our latest tracking forecast of a 5.1% decline of GDP in the first quarter.

Real GDP for January 2009 was back down at the level of February 2007 -- two years ago.

Note: Since this report, MA has revised their Q1 tracking forecast to be a decline of -4.5% annualized.

If the NBER BCDC is the definitive expert on marking of recessions, MA is the definitive expert on measuring real GDP at the monthly level with their MGDP data series.

-- Jack Krupansky

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