S&P Global (formerly Macroeconomic Advisers) released monthly GDP for January today, indicating a rebound in activity – 0.3% m/m growth. Adding this to a graph of key indicators followed by the NBER BCDC yields the following:
Seasonal Adjustment in the Wake of Big Shocks, Economic and Otherwise
Consider the following three examples of seasonally adjusted vs. not seasonally adjusted data.
Volatility in External Demand
Advance estimate for January 2023 goods exports out today. Big jump, compared to the pre-pandemic past, but not compared to the recent past.
Update – Data Paranoia Watch: “I’ve read that others think the CES was manipulated to provide a more rosy picture heading into the election”
Reader Steve Kopits writes about the debate over employment numbers:
At the same time, I thought it possible that both surveys were in fact correct, but garbled with the effect of the recovery from the suppression, thereby creating misleading impressions because we were misinterpreting the data. That still seems possible, though I’ve read that others think the CES was manipulated to provide a more rosy picture heading into the election.
Guest Contribution: “ESG investing, versus those who would ban it”
Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared at Project Syndicate.
Guest Contribution: “The Fed Is Following the Taylor Rule”
Today, we present a guest post written by David Papell and Ruxandra Prodan, Professor and Instructional Associate Professor of Economics at the University of Houston.
PCE Inflation – Headline, Core, Trimmed Month-on-Month and Instantaneous
Core PCE y/y 4.7% vs. 4.3% consensus, headline 5.4% vs. 5.0%.
Business Cycle Indicators – Spending, Income, Sales
Nominal consumption above consensus (1.8% m/m vs. 1.3%). Personal income was 0.6% m/m, vs. consensus 1%. The NBER BCDC looks at real consumption and real income ex-current transers for conjunctural analysis. These are plotted below, along with with real manufacturing and trade industry sales.
GDP, and Guesses about GDI, GDO
We don’t have estimates of GDI, but if we assume nominal net operating surpluses remain constant at 2022Q3 levels ($6.2 trn out of $26 trn GDI SAAR), then we have the following picture.
Dealing with Seasonality with 12 Month Changes: the QCEW
(If you’re wondering about estimating seasonals — and you might be right wonder — then here’s the alternative.) QCEW data are not reported on a seasonally adjusted basis, which makes comparison with the other regularly reported BLS series, based on surveys, difficult. One way to address this issue, while sacrificing a more current perspective, is to use 12 month changes. Here is the QCEW series compared against two others measures of nonfarm payroll growth.