GDP Better than Expected

September 18th, 2017

GDP grew by 2.2% in the 2^nd quarter of 2016 compared to an increase of 3.0% in 2017. The average GDP growth rate since 2011 is still hovering around 2%. The good news is reflected in increases in Personal Consumption Spending fueled by a year over year wage growth rate of 3.3%*.

 

Chart courtesy of Windsor Wealth., and The Bureau of Economic Analysis

 The Institute for Supply Management’s report on manufacturing has the sector for the 99^th consecutive month – some selected comments below; emphasis mine.

• “Steady demand across businesses.” (Chemical Products)

• “Demand for light construction equipment continues strong; usually at this time of year, demand slackens.” (Machinery)

• “Overall very steady; starting to pick up as expected.” (Computer & Electronic Products)

• “Overall optimism about the market, both for 2017 and 2018.” (Miscellaneous Manufacturing)

• “Busy production month for August.” (Textile Mills)

• “Sales remain strong month-to-month.” (Transportation Equipment)

• “Slightly higher order intake.” (Electrical Equipment, Appliances & Components)

• “Order board is very strong right now.” (Food, Beverage & Tobacco Products)

• “Business is steady and strong.” (Furniture & Related Products)

The Conference Board economic indicators represent changes in the indices:

	Consumer Confidence
	Employment Trends index
	Help Wanted Online
	Leading Economic index
	Measure of CEO Confidence

 

Our portfolios favor Domestic and Foreign Equities; our cash position has increased slightly in recent weeks.

Carlos Dominguez – Portfolio Manager

 

*The Atlanta Fed’s Wage Growth Tracker is a measure of the nominal wage growth of individuals. It is constructed using microdata from the Current Population Survey (CPS), and is the median percent change in the hourly wage of individuals observed 12 months apart. Our measure is based on methodology developed by colleagues at the San Francisco Fed.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Carlos Dominguez and not necessarily those of Raymond James.