First off, we must alert you. The U.S. Bureau of Economic Analysis (the BEA) revised its previous real GDP growth estimate for the 2nd quarter a final time to +3.1%. The second estimate was +3.0%. The BEA attributed this final revision to an increase in private inventory investment, business stockpiles, and in particular, farm inventories. It’s harvest season, right? Revised final numbers barely altered the previous picture of a relatively solid expansion in the second quarter, after a modest first quarter growing at +1.2%.
Added to this, this upward second quarter revision has been supplemented by an increase in the ISM manufacturing index, rising to 60.8 in September from 58.8 in August, a 13-year high! The ISM measure includes factors such as output, sales, and hiring. It is a key gauge of conditions in the manufacturing sector. What of the recent series of hurricanes hitting the South of the USA? They do not seem to have affected the ISM index.
Both the GDP revisions and ISM numbers suggest an increasing pace to global growth and a relatively soft U.S. dollar continue to support a modest expansion in growth in the internal U.S. economy.