Highlights of the US GDP report:
- Weakest since Q4 2012
- Q4 2013 growth was at a 2.6% annualized pace
- Personal consumption 3.0% vs 2.0% expected
- Business investment -2.1% vs +5.7% in Q4
- Residential investment -5.7%
- Inventory drawdown cut 0.57 percentage points from GDP
- GDP deflator +1.3% vs 1.6%
- GDP price index 1.3% vs 1.6% exp
- Core PCE q/q 1.3% vs 1.2% exp
Brutal print! The knee jerk is to blame the weather but the consumer was much stronger than expected. Trade appears to be a major lag with exports down 7.6% compared to a 9.5% rise in Q4. Imports were down 1.4%.
Update: This is a bad report. It’s an early reading and this report is always revised but it’s a scary number.