Market commentators and policymakers are optimistic that the latest monthly GDP data are a sign that the economy has turned the corner and that better times lie ahead. The details, however, reveal that this optimism is misplaced. Mining sector volatility and seasonal distortions in the auto sector explain the bulk of recent GDP gains, all of which will be largely reversed in short course. Accordingly, we wouldn’t bet heavily on any meaningful economic rebound this year.
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