US DATA: Q4 real GDP disappointed at +2.8%, and real final sales were
even softer at +0.8% as inventories made up most of the advance. This is
setting up for a weaker Q1, as a slower inventory build will cut growth.
Commerce Dept assumed higher inventories and a rising trade deficit for
missing data. Underlying consumption was decent, led by +14.8% durables
spending. But business spending on structures -7.2% and on eqpt/software
+5.2% ahead of tax depreciation cutbacks, for its slowest pace since
Q2:09 in recession. GDP prices +0.4%, core PCE px +1.1%.
GDP Components: Q1 Q2 Q3 final Q4 initial
Real growth +0.4% +1.3% +1.8% +2.8%
Real final sales +0.0 +1.6 +3.2 +0.8
PCE +2.1 +0.7 +1.7 +2.0
Nonres fixed invest +2.1 +10.3 +15.7 +1.7
Res fixed invest +2.4 +4.2 +1.3 +10.9
Net Exprt Contrib cut 0.34 add 0.24 add 0.43 cut 0.11
Inventory Contrib add 0.32 cut 0.28 cut 1.35 add 1.94