The Federal Reserve Bank of Atlanta has lowered their
forecast for the United States Gross Domestic Product (GDP) in the last three
months of 2021 to 5.0 percent.
"The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2021 is 5.0 percent on January 14, down from 6.8 percent on January 10. After the January 10 GDPNow update and subsequent releases from the US Census Bureau, the US Bureau of Labor Statistics, the US Department of the Treasury’s Bureau of the Fiscal Service, and the Federal Reserve Board of Governors, a decrease in the nowcast of fourth-quarter real personal consumption expenditures growth from 4.5 percent to 2.0 percent was slightly offset by an increase in the nowcast of fourth-quarter real gross private domestic investment growth from 17.8 percent to 18.1 percent. Also, the nowcast of the contribution of the change in real net exports to fourth-quarter real GDP growth decreased from 0.21 percentage points to 0.19 percentage points."
The U.S. Bureau of Economic Analysis (BEA) announced that the nation’s GDP for the 3rd quarter of 2021 came in at 2.3 percent.
Southeast economy expanding at a “moderate” pace
The bank’s latest summary of economic activity found:
"Economic activity in the Sixth District expanded moderately from mid-November through December, even amidst widespread outbreaks of the Omicron variant late in the reporting period. Demand for workers remained strong and labor market tightness persisted. Upward pressure on wages was widespread. Nonlabor costs grew, albeit at a slower pace. Retail sales were solid; auto sales, however, remained challenged due to supply chain constraints. Domestic leisure travel was strong. Business travel and convention bookings picked up somewhat, though increases in Omicron cases precipitated some postponements and cancellations in the near term. Robust housing demand continued. Conditions in commercial real estate improved. Manufacturing activity was healthy. Conditions at financial institutions were steady, though deposit levels declined, and loan demand slowed somewhat."
·
Consumer spending was healthy, particularly
for off-price retailers. Cruise ship business was strong, though passenger
counts were lower than before the pandemic as cruise lines have continued to
limit capacity.
·
Demand from investors and second-home buyers
continued to make up a significant component of housing market demand.
·
Manufacturing contacts reported increased
revenues and believe business will continue to improve this year, even as some
expressed concerns about supply chain interruptions, labor shortages, and
rising input costs.
·
Transportation stayed strong. Container
volume grew at district seaports, and air cargo contacts noted increased demand
because of surging ecommerce shipments.
· Chemical manufacturing and petroleum refining improved. However, contacts continued to report that supply chain bottlenecks constrained some chemical production.
The report for all the Federal Reserve banks on economic conditions for their districts can be found at https://www.federalreserve.gov/monetarypolicy/beigebook202201.htm.
The next meeting of the Federal Open Market Committee is
scheduled for January 25-26, 2022.
