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MajorAgendaThu, Oct 29 ET 8:30 AM pre-market1 min read
Gross domestic product, or GDP, measures the goods and services the US economy produces. This growth reading compares inflation-adjusted output in the third quarter with the preceding quarter. The estimate is 3.1%, above the previous 2.2%. Recent reports show support from employment but weaker housing and fading factory momentum, making the sources of growth as important as the total.[1]
Expected 3.1% Last release 2.2%
If it comes in above expectations If growth exceeds 3.1%, overall output expanded faster than expected, potentially supporting a firmer business-demand outlook and reducing the urgency for Fed easing. Check that inventories or trade did not account for most of the strength.[1]
If it comes in below expectations If growth is below 3.1%, output expanded less than expected, calling for more caution about business revenue. Weak consumption and investment would strengthen the case for easing if inflation allows.[1]
For stocks, growth led by consumption and investment is more supportive of retailers, industrial companies and transport revenue. But less scope for falling rates can squeeze property and financing-dependent businesses. Weak growth may offer borrowing-cost relief while undermining sales. Examine consumption and investment first, then whether inventories, imports or exports make the headline look different from companies' customer demand.[1]