7/27/2018
By Charles Payne, CEO & Principal Analyst

Headline GDP came in at 4.1%, which missed consensus of 4.4%, but the street was busy coming down on their numbers all week.  So, if there was a “whisper number,” it would have been this morning’s print.  Bottom line, the number is huge and encouraging.

The best quarter since 3Q2014 with final revision to 1Q2018 to 2.2% from 2.0%.

Consumption 4.0 from 0.5

• Goods 5.9 from -0.6
• Services 3.1 from 1.0

Investment -0.5 from 9.6

• Business 7.3 from 11.5
• Structure 13.3 from 13.9
• Equipment 3.9 from 8.5

Exports 9.3 from 3.6

Government 2.1 from 1.5

Real Final Demand of 5.1 is the strongest since 1Q2006

Some are calling this a Goldilocks number in part to the PCE price index coming in at 1.8 from 2.5 on headline and 2.0 from 2.2 ex food and energy.  Naysayers will point to an increase in soybean exports, but the fact is, that is a small percentage of the number.  Moreover, business inventories didn’t reflect panic, which means there is steady demand, and consumers strength should remain constant through the rest of the year.

Charles Payne
Wall Street Strategies

Add a Comment!