The latest Atlanta Fed GDPNow tracking estimate is out for the fourth quarter and the reading was left unchanged after durable goods orders:
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2025 is 5.4 percent
on January 26, unchanged from January 22 after rounding. New orders for manufactured durable goods in November, up three of the
last four months, increased $16.4 billion or 5.3% to $323.8
billion, the U.S. Census Bureau announced earlier today.Much of the gain was in transport orders as non-defense capital goods ex-air orders rose 0.7% versus 0.3% expected.
I’m taking Q4 GDP data with a big dose of caution as the US government shutdown created a mess of US economic data, and we’re also sorting through the effects of the trade war. US imports cratered in Q4 and that creates a mechanical lift in GDP but it’s likely reversed by a drawdown in inventories, something that’s not tracked as well in the data. That latter factor could take many months (and revisions to GDP) to show up.
That’s why the market is watching employment and consumer spending as better sign of the health of the US economy. At the moment, the employment numbers are relatively stable but the vast majority of hiring last year was in the healthcare space. Further clouding the employment picture is the huge crackdown on illegal immigrants and questions about how those jobs will be backfilled
Atlanta Fed GDPNow remains at 5.4% for the fourth quarter
