It appears it will be much worse than our numbers suggested (derived from historical consumption data). The trade report released today painted a grim picture on economic growth, as exports, the engine of the US economy the past few years, hit a wall in September and October.
U.S. gross domestic product is on track to decline at a 6.6% annual rate this quarter, one of its worst performances ever, economists for Macroeconomic Advisers said Thursday. After the release of the October trade deficit report Thursday, the firm revised down its GDP tracking forecast by 0.7 percentage point, reflecting a much weaker contribution from exports. The government’s estimate will be released on Jan. 30. Since 1947, GDP has fallen as much as 6.6% only twice: the second quarter of 1980 (down 7.8%) and the first quarter of 1958 (down 10.4%).
It’s not looking good.