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US 3Q GDP Headline Print Better Than Expected, But Inventories Lead The Way

The advance US 3Q GDP report - the 1st of 3 - came in stronger than expected at 2.8% compared to forecasts of a 2.0% increase.

Here's a good graphic for looking at the composition of GDP:


(Courtesy of ZeroHedge)

  • The important thing to notice is that around 0.8% of that growth was fueled by inventory accumulation, which is volatile and could be pulling demand from the 4Q and will have a "make-up" period when inventories are then rundown. 
  • Personal consumption was at 1.5%, slightly lower than in the 2Q.