Temporary disruption or more serious downturn?

In purely mechanical terms, the limited data released this week did trigger a downward revision to our third-quarter GDP growth forecast to 1.7%, from 2.0%. But only because the June trade data sets up for a slightly stronger gain in third-quarter imports. If the economy was truly in a slump, we wouldn’t expect to see imports growing at a 5% annualised pace. At the same time, the nowcast model maintained by our Data Team puts third-quarter GDP growth as high as 3.9%.