Right here’re some indicators on the weeky frequency for the true financial system. Bloomberg notes that GDPNow (3/16) mixed with SEP median of 0.4% progress fee for 2023 implies 3 quarters of detrimental GDP progress beginning in Q2. The most recent knowledge under relate to late in Q1.
Determine 1: Lewis-Mertens-Inventory Weekly Financial Index (blue), OECD Weekly Tracker (tan), Baumeister-Leiva-Leon-Sims Weekly Financial Circumstances Index for US plus 2% development (inexperienced). Supply: NY Fed by way of FRED, OECD, WECI, and writer’s calculations.
The Weekly Tracker continues to learn robust progress, for the week ending 3/18, exceeding the WEI (1.1%) and WECI+2% (1.8%). The WEI studying for the week ending 3/18 of 1.1% is interpretable as a y/y quarter progress of 1.1% if the 1.1% studying had been to persist for a whole quarter.The Baumeister et al. studying of -0.02% is interpreted as a -0.02% progress fee in extra of long run development progress fee. Common progress of US GDP over the 2000-19 interval is about 2%, so this suggests a 1.8% progress fee for the yr ending 3/18. The OECD Weekly Tracker studying of two.4% is interpretable as a y/y progress fee of two.4% for yr ending 3/18.
Recall the WEI depends on correlations in ten sequence out there on the weekly frequency (e.g., unemployment claims, gasoline gross sales, retail gross sales), whereas the WECI depends on a blended frequency dynamic issue mannequin. The Weekly Tracker — at 2.4% — is a “huge knowledge” strategy that makes use of Google Traits and machine studying to trace GDP. As such, it doesn’t depend on precise financial indices per se.
Pawel Skrzypczynski does the work on what the GDPNow calculation plus median SEP implies:
Supply: Pawel Skrzypczynski. [corrected 3/24]