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Slowing labour market recovery pushes Q4 GDP nowcast below 1.4 per cent

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  • The EIU nowcast for the US economy for Q4 2020 further weakened to 1.37% (quarter-on-quarter) as of last week, compared with 1.41% during the week ending 30th October.

  • Last week was characterised by data releases for the month of October and data revisions for September. Overall, the nowcast weakened as the downward revisions for employment outweighed the positive effect of improved releases.

  • ADP employment data for October indicated the addition of 365,000 jobs to the US economy, well below an upwardly revised 753,000 in September. Non-farm payroll employment from the BLS indicated the addition of 638,000 jobs in October, easing from an upwardly revised 672,000 in September.

  • Initial claims for unemployment insurance increased to 758,00 compared with 751,000 the week before.

  • Nonetheless, the labour market recovery in October was more modest than the EIU nowcast had previously expected, resulting in the week-on-week decline in the GDP outlook.

  • The ISM Manufacturing index improved to 59.3 in October 2020 highlighting the strongest rise since September 2018, while the ISM Non-Manufacturing index fell to 56.6 in October 2020 compared with 57.8 in September, the lowest since June 2020.

  • To get the full background to our EIU Nowcast, view our methodology and FAQs page or contact us using the form below.

Data releases (last week)

IndicatorsReference PeriodLatest dataPrevious data
ISM Mfg: PMI Composite Index (SA, 50+ = Econ Expand)Oct (20’)59.3055.40
US Markit PMI: Manufacturing [Actual] [Latest Estimates incl Flash] (SA, 50 +=Expansion)Oct (20’)53.3653.24
Manufacturers’ New Orders: Durable Goods [Actual] (SA, Mil.$)Sep (20’)237380.00232933.00
Manufacturers’ Inventories: Durable Goods [Actual] (EOP, SA, Mil.$)Sep (20’)421799.00420373.00
Manufacturers’ Unfilled Orders: Durable Goods [Actual] (EOP, SA, Mil.$)Sep (20’)1075897.001078431.00
ADP Nonfarm Private Payroll Employment (SA Change, Thous.)Oct (20’)365.00753.00
ISM Non Manufacturing : NMI Composite Index (SA, +50=Increasing)Oct (20’)56.6057.80
Exports, f.a.s.: Goods [Actual] (SA, Mil.$)Sep (20’)122546.40118724.80
Imports, Customs Value: Goods [Actual] (SA, Mil.$)Sep (20’)201901.50201805.10
US PMI: Svcs Business Activity Index [Actual] [Latest Est incl Flash](SA, 50+=Expansion)Oct (20’)56.9454.56
Unemployment Insurance: Initial Claims, State Programs (SA, Thous)Oct (20’)758.00849.00
Change in Nonfarm Payrolls excluding the Effect of Strikes (SA, Thous)Oct (20’)638.00668.00

Data releases (current week)

IndicatorsReference PeriodRelease Date
Unemployment Insurance: Initial Claims, State Programs (SA, Thous)Nov (20’)12th Nov 2020
University of Michigan: Consumer Sentiment [Flash] (NSA, Q1-66=100)Nov (20’)13th Nov 2020
University of Michigan: Current Economic Conditions [Flash] (NSA, Q1-66=100)Nov (20’)13th Nov 2020
University of Michigan: Consumer Expectations [Flash] (NSA, Q1-66=100)Nov (20’)13th Nov 2020

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