05242019Fri
Last updateThu, 23 May 2019 6pm

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U.S. Economy Grew 2.9% in 2018

Real gross domestic product (GDP) in the U.S. increased at an annual rate of 2.2% (down from the original estimate of 2.6%) in the fourth quarter of 2018, according to the third estimate released by the Department of Commerce. In the third quarter, real GDP increased 3.4%.

Real GDP increased 2.9% in 2018, compared with an increase of 2.2% in 2017.


NABE Survey Predicts GDP Slowdown

According to the March 2019 National Association for Business Economics (NABE) Outlook Survey, real GDP growth will slow from 2.9% in 2018 to 2.4% in 2019, and to 2.0% in 2020. The anticipated growth rate for 2019 is lower than the 2.5% percent forecasted in the December 2018 survey. The panel has turned less optimistic about the outlook since the previous survey, as three-quarters of respondents see risks tilted to the downside, and only 6% perceive risks to the upside.

Texas Manufacturing Activity Continues to Grow

Texas factory activity continued to expand in March, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, held fairly steady at 11.5, indicating output growth continued at about the same pace as last month.

Other measures of manufacturing activity also suggested continued expansion in March, although demand growth slowed. Perceptions of broader business conditions continued to improve in March, although outlooks were less optimistic than in February. The general business activity index remained positive but fell five points to 8.3. Similarly, the company outlook index stayed in positive territory but fell from 14.2 to 6.0. The index measuring uncertainty regarding companies’ outlooks was largely unchanged at a 10-month low of 3.4.

Leading Economic Indicators End Five Month Skid

The Conference Board Leading Economic Index (LEI) for the U.S. increased 0.2% in February to 111.5, following no change in January, and a 0.1% decline in December.

“The U.S. LEI increased in February for the first time in five months,” said Ataman Ozyildirim, director of economic research at The Conference Board. “February’s improvement was driven by accommodative financial conditions and a rebound in stock prices, which more than offset weaknesses in the labor market components. Despite the latest results, the U.S. LEI’s growth rate has slowed over the past six months, suggesting that while the economy will continue to expand in the near-term, its pace of growth could decelerate by year end.”

Factory Orders Barely Rise in January

New orders for manufactured goods in January, up two consecutive months, increased $0.3 billion or 0.1% to $500.5 billion, the U.S. Department of Commerce reports. This followed a 0.1% December increase. Shipments, down four consecutive months, decreased $1.8 billion or 0.4% to $503.1 billion. This followed a 0.2% December decrease.

New orders for manufactured durable goods in January, up three consecutive months, increased $0.9 billion or 0.3% to $255.3 billion, down from the previously published 0.4% increase. This followed a 1.3% December increase.

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