This is the first dip into negative territory and it’s a big dip. You could see this coming after yesterday’s Q1 GDP revisions. The consumption numbers in today’s PCE report were also poor.
The release:
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2022 is -1.0 percent on June 30, down from 0.3 percent on June 27. After recent releases from the US Bureau of Economic Analysis and the US Census Bureau, the nowcasts of second-quarter real personal consumption expenditures growth and real gross private domestic investment growth decreased from 2.7 percent and -8.1 percent, respectively, to 1.7 percent and -13.2 percent, respectively, while the nowcast of the contribution of the change in real net exports to second-quarter GDP growth increased from -0.11 percentage points to 0.35 percentage points.
This report normally isn’t a market mover but with all eyes on growth suddenly, it could be. A negative reading in Q2 GDP would be a technical recession after -1.5% in Q1.
USD/ JPY is at the lows of the day.
We’ll get another update on this tracker tomorrow after construction spending and the ISM manufacturing report.