Strong retail sales push growth forecasts to 3 percent for fourth quarter, even with slowdown scare


Market / News 899 Views 0

People shop during a Black Friday sales event at Macy's flagship store on 34th St. in New York City, November 22, 2018. 

Stephanie Keith | Reuters

Individuals store during a Black Friday gross sales event at Macy's flagship retailer on 34th St. in New York City, November 22, 2018. 

Robust shopper spending is giving a lift to fourth-quarter GDP progress, pushing it as much as three %, in accordance with a survey of economists.

Economists, collaborating within the CNBC/Moody's Analytics GDP rapid update raised their forecast by 0.2 proportion factors following the stronger-than-expected November retail sales report. Excluding cars, gasoline, constructing supplies and food, retail sales gained 0.9 % in November, on prime of a revised zero.7 % improve in October.

Third quarter GDP progress was three.5 %, however economists have been on the lookout for a slowdown within the fourth quarter continuing into subsequent yr.

For 2019, the survey exhibits economists anticipate a progress tempo of 2.4 %.

The economists in the speedy update survey see fourth quarter progress between 2.7 % and 3.1 %. Monitoring forecasts for GDP take into consideration incoming knowledge and are updated ceaselessly.

Barclays economists upped their monitoring forecast Friday to 2.9 % from 2.5 %, principally because of retail sales.

"The acceleration in gross sales could possibly be partly attributed to Black Friday and different holiday-season associated buying occasions throughout this time of the yr. There have been additionally substantial upward revisions to October's knowledge, both on the headline and core degree. Taken together, this morning's report points to stronger momentum in retail sales than what we had expected, and bodes properly for This fall consumption spending," they wrote.

Consumption added zero.5 % to GDP, but the Barclays economists raised progress by simply zero.4 proportion points as a result of the robust pickup in gross sales suggests a fall in inventories. Barclays also trimmed 0.1 proportion points as a result of lowered retail inventories.