The Atlanta Fed has a publication titled the GDPNow Forecast. It is uses a model to come up with conclusions about economic growth. The most recent addition of the calculations shows that gross domestic product rose only 0.6% in the first quarter, well below almost any mainstream forecast.
The Atlanta Fed’s most recent addition of its prediction about the first quarter is the GDPNow Forecast for 2017: Q1, issued on April 7. Earlier versions of the forecast go back to January 30, when the forecast was 2.3%, close to most consensus forecasts. Each time the government releases a major piece of economic news, the forecast changes. There have been 33 so far since the January 30 assessment. The highest was on 3.4%, when the ISM construction spending data was issue. The figure dropped following most major announcements after that, and then made a short-term bottom of 0.9% on March 10 after the Treasury Department statement on employment. The number has not moved above 1.3% since then.
The argument about ignoring the data is that it only comes from a model that has not been blessed by any government agency, economic organization or even major economist. On the other hand, it does take in a wide breadth of information.
And there are one or two things that occurred in the economy recently that are worrisome. The economy was forecast to add 180,000 jobs. It only added 98,000. The weather was blamed for some of the shortfall. So was the disintegration of the retail industry.
The slow death of mainstream retail, which is quickening, could be enough to harm GDP on its own. Retail is such a large portion of the employment base, and demand for retail goods tends to be a strong economic indicator.
A 0.6% GDP growth rate in the first quarter is not out of the question.