The ongoing government shutdown delayed the release of the Commerce Department’s initial estimate of the third-quarter gross domestic product (GDP), as other data sources suggest solid economic growth in the quarter.
The Bureau of Economic Analysis was scheduled to release its advance estimate of third-quarter GDP on Thursday, though the furlough of workers deemed nonessential prevented the agency from compiling and releasing the report.
The Labor Department’s statistical agency, the Bureau of Labor Statistics, also missed producing the September jobs report due to the shutdown. However, the need to produce the September consumer price index – which is a key component of the annual Social Security cost-of-living adjustment (COLA) – prompted the agency to temporarily return workers to publish that inflation report.
Despite the lack of an official third-quarter GDP estimate from the Commerce Department and uncertainty over when the government shutdown will end to allow its release, there are other estimates of third-quarter GDP that have been published by a pair of Federal Reserve banks.
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The Federal Reserve Bank of Atlanta has a forecasting model called GDPNow that serves as a “nowcast” of real gross domestic product prior to its release.
While it isn’t an official forecast, the Atlanta Fed explains that GDPNow is “best viewed as a running estimate of real GDP growth based on available economic data for the current measured quarter.
The Atlanta Fed’s GDPNow’s latest estimate from Oct. 27 put third-quarter GDP at 3.9% for the quarter.
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The Federal Reserve Bank of New York also publishes a staff nowcast, which is slightly different in that it includes probability bands for GDP growth on either side of the estimate.
The New York Fed’s staff nowcast estimated that as of Oct. 31, third-quarter GDP grew 2.35% with a 50% probability that quarterly GDP growth will be between 1.32% and 3.41%.
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The Commerce Department’s GDP data from earlier this year showed that the U.S. economy contracted 0.5% in the first quarter.
The Bureau of Economic Analysis found the economy grew at a rate of 3.8% in the second quarter, leaving GDP growth in the first half of the year at an annualized rate of about 1.66%.
Incorporating the Atlanta Fed’s nowcast showing 3.9% GDP growth in the third quarter would imply 2.4% GDP growth for the economy through the first three quarters of 2025.
The New York Fed’s nowcast of 2.35% GDP growth in the third quarter would result in 1.88% GDP growth for the first three quarters of the year.
