Analysts Anticipate 3.2% Annualized Growth in US Q3 GDP Ahead of Official Data
The United States (US) Bureau of Economic Analysis (BEA) will publish the primary preliminary estimate of the third-quarter Gross Domestic Product (GDP) on Tuesday, at 13:30 GMT.
Analysts count on the info to point out annualized development of 3.2%, following the three.8% enlargement in the earlier quarter.
Markets Expect Solid GDP Expansion to Continue in the Three Months to September
Growth in the US seems to have picked up pace after contracting by 0.5% in the three months to March, and the anticipated 3.2% studying, regardless of being under the earlier one, ought to point out wholesome financial progress.
And, in truth, development in the US doesn’t appear to be an issue today. Rather than that, the main target is on a weak labor market. It’s additionally on the Federal Reserve (Fed) and the long run of financial coverage, which is clearly associated to the tepid employment scenario.
Alongside the GDP headline, the BLS will launch the GDP Price Index – also called the GDP deflator – which measures inflation throughout all domestically produced items and providers, together with exports however excluding imports. The index stood at 2.1% in Q2, a fairly encouraging degree given the three.8% posted in the beginning of the 12 months.
Also, it’s value noting that the Atlanta Fed’s GDPNow mannequin estimate for actual GDP development (seasonally adjusted annual price) in the third quarter of 2025 is 3.5%, in keeping with the newest estimate. The determine shouldn’t be an official forecast, however because the Atlanta Fed website notes, it serves “as a working estimate of actual GDP development based mostly on out there financial information for the present measured quarter.”
There is, nevertheless, a caveat: stable employment creation throughout Q2 largely contributed to secure consumption ranges. That wouldn’t be the case in Q3, because the labor market has loosened past ranges the Fed would contemplate snug.
The Unemployment Rate rose to 4.6% in November, in keeping with the newest Nonfarm Payrolls (NFP) report, exceeding expectations of 4.4%. Job creation in the same month accounted for 64K, but earlier months’ readings have been downwardly revised, that means employment in August and September mixed is 33,000 decrease than beforehand reported. October information is lacking because of the authorities shutdown, which clearly worsened the employment scenario.
So, on the one hand, watching forecasts and the Atlanta Fed GDPNow mannequin, it appears GDP would end result above 3%. A worsened labor market, however, can take that quantity approach down.
When Will the Gross Domestic Product Print Be Released, and How Can It Affect The US Dollar Index?
As beforehand famous, the US GDP report is due at 13:30 GMT on Tuesday, and is expected to impact the US Dollar (USD). The market response might be overstretched given the continued winter holidays and the diminished buying and selling volumes that sometimes accompany them.
Given the broad USD weakness, a unfavorable studying is more likely to have a wider influence on the American foreign money and ship it additional south. A greater-than-anticipated determine, quite the opposite, might convey some air to the USD bulls, but it’s unlikely to vary its predominant bearish development.
Valeria Bednarik, FXStreet Chief Analyst, notes:
“The US Dollar Index (DXY) hovers round 98.30 forward of the announcement, not far above its December low at 97.87. From a technical standpoint, the DXY is bearish. In the every day chart, a flat 100 Simple Moving Average (SMA) at round 98.60 attracts promoting curiosity, containing advances. In the identical chart, a bearish 20 SMA accelerates its slide above the bigger one, reflecting mounting promoting stress. Finally, the identical chart reveals that technical indicators keep downward slopes inside unfavorable ranges, in line with decrease lows forward.”
Bednarik provides:
“A poor GDP studying might push the DXY in direction of the talked about month-to-month low, with extra slides exposing 97.46, the intraday low from September 30. Further declines ought to see the index nearing the 97.00 threshold, the place the decline is more likely to decelerate. Friday’s high at 98.42 offers rapid resistance forward of the 100-day SMA at 98.60. Once above the latter, 99.00 comes as the subsequent barrier.”
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