GDP nowcast: Q1, 2024: +1.7%
The 4Lights GDP Nowcast model is predicting that 1st quarter GDP grew at +1.7% (annualized, quarter-over-quarter rate)
1st quarter GDP will be published in about 1 month, so how’s the model evolving so far? Well, it’s been a mixed bag: data started off strong but was then revised down. However, economic indicators have been positive for the last month or two, which has increased the model’s growth forecast. Of the 220 data points my model has collected so far this quarter, 122 have been positive (cumulative net positive indicators of +5.3%).
Sub 2% growth isn’t great, but it’s likely the right amount of “cool down” needed to get inflation back to 2% (which is the main mission at the Fed right now).
How are other nowcasts tracking?
New York Fed Staff Nowcast for Q1, 2024: +1.9%
Atlanta Fed GDPNow for Q1, 2024: +2.1%
Calculated Risk notes that Bank of America and Goldman Sachs are forecasting +2.2% and +1.9%, respectively.
My model has been consistently more pessimistic than the others, but that’s ok. What do you think GDP will be in the first quarter?