US: Trade and inventory data imply less real GDP growth in Q2 – Nomura

Analysts at Nomura point out that the US advance goods trade and inventories report and the advance durable goods release for June were somewhat mixed before the BEA releases the advance estimate of Q2 real GDP growth.

Key Quotes

“Trade and inventory data surprised to the downside with a wider-than expected goods trade deficit and soft inventory accumulation. However, the advance durable goods report showed strength in core orders and shipments (nondefense excluding civilian aircraft), indicating steady business equipment investment in end-Q2.”

“Altogether, we lowered our Q2 real GDP forecast 0.4pp to 4.2% q-o-q saar. Despite the downward revision, were our forecast to be realized, GDP growth would still average above 3.0% during H1 2018, indicating solid underlying economic momentum.”