Economic wrap: US Q3 GDP increase, Q4 revised lower - Westpac

Analysts at Westpac offered an 'Economic Wrap'.

Key Quotes:

"US GDP for Q3 was revised higher from 3.3% to 3.5% annualised (vs 3.3% expected), ostensibly on a stronger consumer. Durable goods orders fell 4.6% in Nov (-4.8% expected), "core capital goods ex air and defence equipment" rising 0.5% (0.2% expected) and the prior month revised +0.1ppt. That said core shipments were once again subdued at +0.2% (+0.1% expected) and the prior month was revised down 0.2ppts

Personal income was unchanged in Nov (+0.3% expected), personal spending up 0.2% (0.3% expected). The PCE deflator (a Fed preferred measure of inflation) was flat in Nov (+0.2% expected), for a steady yoy rate of 1.4%.

Following all the above releases, the Atlanta Fed downgraded its model prediction for Q4 GDP from 2.6% to 2.5%."