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Today, we have an all-important release of US Q1 GDP report due to be published at 1230 GMT, which is likely to attract the most attention.

Most of the economists and researchers are expecting the US Q1 GDP to advance in between 2.2-2.5% despite the impact of the government shutdown.

TD Securities

“We expect GDP to advance 2.3% q/q saar in Q1, largely keeping with the economy’s Q4 pace. Despite a notable slowdown in consumer spending, we anticipate an offsetting shift from negative to positive contributions for net exports and government spending. Indeed, we expect the contribution to growth by private consumption to be around half of what it was in Q4 2018.”

“Notably, and reflecting the recent pick-up in the housing sector, residential investment likely contributed positively to growth for the first time since 2017. All in, a more solid Q1 print suggests less impetus for a particularly large bounce back reflected in the Q2 GDP print.”

Scotia Bank

Analysts at Scotia bank believe that the US GDP growth is likely to be stronger in the first quarter despite the impact of the government shutdown. The US Q1 GDP report is due to be published later today at 1230 GMT.

“Scotiabank Economics estimates that Q1 GDP growth was probably at about 2% and possibly stronger.”

“‘Nowcast’ model run by Scotia ‘… estimate of 2.4%. Atlanta Fed’s ‘nowcast’ is at 2.8.”

“”¦ but nowcasts that are based upon longer-run models don’t fully account for the effects of the US government shutdown. Shutdown influences would knock 0.4% off Q1 according to the CBO’s estimate. CBO estimates that ending the shutdown could add 1% to GDP growth in Q2.”


Bill Diviney, senior economist at ABN AMRO, points out that for the US economy, the advance estimate for Q1 GDP will be released today and they expect a softening in momentum to 1.5% qoq annualised, while consensus expects growth to be stable at 2.2% (same as Q4).

“We note greater uncertainty in Q1 GDP than usual, thanks largely to the government shutdown over December-January, which led to delayed salary payments for 800,000 federal employees, and disruption to tax refunds and regulatory approvals.”

“The high frequency data suggests activity has rebounded more quickly than anticipated, with retail sales in particular pointing to strong growth in private consumption. However, investment – for which higher frequency data is more limited (particularly for intellectual property investment) – could be the fly in the ointment.”

“The Atlanta Fed’s tracker for Q1 implies an acceleration to 2.8%, while the New York Fed’s measure is closer to our own forecast at 1.8%. Which is the more historically accurate? Typically the Atlanta Fed measure. This differed from the advance GDP release on average by just 0.3pp over the past four quarters, compared to a 0.9pp difference for the New York Fed’s tracker. However, there have been occasional outliers, and the Atlanta Fed estimate has at times differed by as much as 1-2pp from the GDP release.”

“Regardless of Friday’s outturn, we continue to expect an overall slowing in growth in 2019 to 2.3% from 2.9% in 2018, with quarterly annualised growth likely to dip below potential (c.1.8%) by year end.”

National Bank Financial

“A moderation in growth from the prior quarter – recall the +2.2% growth print in 2018Q4 ─ is in the cards. That’s because of a likely drag from destocking after inventory accumulation last year.”

“Trade probably contributed to Q1 growth thanks to rising exports and declining imports. Business investment spending may also have boosted growth based on rising shipments of non-defense capital goods excluding aircraft, a reasonably good proxy. But consumption spending growth seems to have lost steam based on retail results during the quarter.”

“Overall, we expect GDP growth of around 1.5% annualized in the first quarter. We’ll get more information about the handoff to Q2 thanks to March data.”


James Knightley, chief international economist at ING, suggests that there has been a dramatic turnaround in recent weeks for the US economy and they are looking for growth of 2.5% while the consensus is a little more cautious in forecasting 2.2% growth for 1Q.

“The Atlanta Federal Reserve bank model, is suggesting that we should be looking for 2.8% thanks to strong retail sales, construction and ISM manufacturing numbers. Such an outcome would be well ahead of the 2.2% rate recorded in 4Q18.”


“US data at the turn of the year was disappointingly weak. However, as Q1 has rolled on, momentum has stabilised, and in some instances, begun to firm. As a result, we look for a gain in Q1 a touch above potential at 2.2% annualised.”

“Domestic final demand is likely to be a little weaker than the headline print, circa 2.0% annualised. Supporting this outcome will be subdued gains for the consumer and business investment, but strength in public demand.”

“As the year rolls on, the consumer pulse is expected to hold around the current level, but business investment will slow further. The recent decline in residential construction should abate, but this will only partly offset the loss of support from the public sector come Q4.”

Danske Bank

“In the US, we get the first estimate of GDP growth in Q1 today. We expect to see a more or less unchanged GDP number for Q1 relative to Q4, 2018. However, a lower than expected number will add to the downward pressure on US Treasuries as political pressure for a rate cut will increase.”