The expected increase in US inventory appears to be larger than we thought it would. In turn, we are increasing our estimate of third quarter U.S. GDP growth. Wholesale inventories rose 0.6% in July as well as the two months prior. Nonauto wholesale inventories were up $43 billion annualized in July in comparison with the $17.4 billion average monthly gain in the second quarter.
The increase in real inventories this quarter is currenty at $14.8 billion at an annual rate, $6.2 billion more than formally predicted. Thus, our estimate of third quarter GDP growth has moved from 2.8% to 3% at an annual rate.
Wholesale trade didn’t affect tracking the estimate of second quarter GDP growth. Thursday, the final Quarterly Services Survey for the second quarter raised our tracking estimate of second quarter GDP growth from 3.1% to 3.3% at an annual rate. The QSS also suggests that real consumer spending growth will soon be revised to a higher value.
https://www.economy.com/dismal/tools/high-frequency-gdp-model
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