Economic Release Snapshot: GDP Growth Beats Expectations

Each week, we break down the latest U.S. economic reports, including what the results mean for the overall health of the economy. Here, you will find how economists’ forecasts compare with actual results, key takeaways to consider, as well as a list of what’s on tap for the week ahead. 

Reports for the Week of January 23

Fourth-quarter GDP growth, advance estimate (Thursday)

• Expected/prior annualized GDP growth: +2.6%/+3.2%
• Actual annualized GDP growth: +2.9%
• Expected/prior annualized personal consumption: +2.9%/+2.3%
• Actual personal spending change: +2.1%

The fourth-quarter GDP report showed that the economy grew more than expected. Personal consumption slowed compared to the third quarter; however, the 2.1 percent annualized increase in consumption to end the year was solid on a historical basis.

Durable goods orders, December, preliminary (Thursday)

• Expected/prior durable goods orders monthly change: +2.5%/–1.7%
• Actual durable goods orders change: +5.6%
• Expected/prior core durable goods orders monthly change: –0.2%/+0.1%
• Actual core durable goods orders change: –0.1%

Both headline and core durable goods orders came in above expectations to end the year. The surge in headline orders was largely due to a spike in volatile transportation orders during the month.

Personal spending and personal income, December (Friday)

• Expected/prior personal income monthly change: +0.2%/+0.3%
• Actual personal income change: +0.2%
• Expected/prior personal spending monthly change: –0.2%/–0.1%
• Actual personal spending change: –0.2%

While personal income continued to grow in December, spending fell for the second consecutive month to end the year.

Upcoming Reports for the Week of January 30

Conference Board Consumer Confidence, January (Tuesday)

Economists expect to see slightly higher consumer confidence in January.

ISM Manufacturing, January (Wednesday)

Manufacturer confidence is expected to decline modestly and remain in contractionary territory to start the year.

FOMC rate decision (Wednesday)

The Fed is expected to hike the federal funds rate 25 bps at its February meeting as the central bank aims to slow the pace of rate hikes in 2023.

Employment report, January (Friday)

The pace of hiring is set to slow again in January; however, even with the anticipated slowdown, hiring is expected to remain healthy on a historical basis.

ISM Services, January (Friday)

Service sector confidence is expected to partially rebound in January after experiencing a larger-than-expected decline in December. If estimates prove to be accurate, the index will start the year in expansionary territory.