25 Jun 2014
US 1Q GDP likely revised down sharply - RBS
FXStreet (Bali) - Brian Daingerfield and Paul Robson, FX Strategists at RBS, expect the third estimate of US first quarter GDP to be revised sharply lower.
Key Quotes
"US data releases on Wednesday include the third estimate of US first quarter GDP and May durable goods orders. Normally the third revision of GDP does not take on a major focus, particularly as the data are lagged – the second quarter is almost over, after all. But this time the third estimate should include a substantial downward revision, we expect the previously reported 1.0% q/q annualized to be revised to a 2.0% decline."
"The driver of the revision should be a downward revision to consumption, after the quarterly services survey showed that the hospital services spending within the services consumption category likely rose significantly less than previously assumed. The downward revision to first quarter GDP, particularly one coming from the consumption side, may weaken the USD tomorrow."
"The move could be compounded if durable goods orders drop in line with our expectation (consensus flat, RBS -1.5% m/m). The volatile defense bookings category may be due for a retracement after it surged in April. The Markit preliminary June services and composite PMIs round out the busy US data calendar tomorrow."
Key Quotes
"US data releases on Wednesday include the third estimate of US first quarter GDP and May durable goods orders. Normally the third revision of GDP does not take on a major focus, particularly as the data are lagged – the second quarter is almost over, after all. But this time the third estimate should include a substantial downward revision, we expect the previously reported 1.0% q/q annualized to be revised to a 2.0% decline."
"The driver of the revision should be a downward revision to consumption, after the quarterly services survey showed that the hospital services spending within the services consumption category likely rose significantly less than previously assumed. The downward revision to first quarter GDP, particularly one coming from the consumption side, may weaken the USD tomorrow."
"The move could be compounded if durable goods orders drop in line with our expectation (consensus flat, RBS -1.5% m/m). The volatile defense bookings category may be due for a retracement after it surged in April. The Markit preliminary June services and composite PMIs round out the busy US data calendar tomorrow."