Q3 GDP Forecasts

From Merrill Lynch:

We continue to track 2Q GDP at -31.7% qoq saar, unchanged from the second estimate. 3Q GDP tracking is now at 25% qoq saar, up from 19% last week owing to strong exports and auto sales. [Sept 4 estimate]
emphasis added

From the NY Fed Nowcasting Report

The New York Fed Staff Nowcast stands at 15.6% for 2020:Q3 and 7.3% for 2020:Q4. [Sept 4 estimate]

And from the Altanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2020 is 29.6 percent September 3, up from 28.5 percent on September 1 [Sept 3 estimate]

It is important to note that GDP is reported at a seasonally adjusted annual rate (SAAR).  A 25% annualized increase in Q3 GDP, is about 5.7% QoQ, and would leave real GDP down about 5.1% from Q4 2019.

The following graph illustrates this decline.

Recession Measure, GDPClick on graph for larger image.

This graph shows the percent decline in real GDP from the previous peak (currently the previous peak was in Q4 2019).

This graph is through Q2 2020, and real GDP is currently off 10.2% from the previous peak.  For comparison, at the depth of the Great Recession, real GDP was down 4.0% from the previous peak.

The black arrow shows what a 25% annualized increase in real GDP would look like in Q3.

Even with a 25% annualized increase (about 5.7% QoQ), real GDP will be down about 5.1% from Q4 2019; a larger decline in real GDP than at the depth of the Great Recession.

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