Weekly Economic Update: January 29 - February 2, 2018

January 29, 2018

CHART OF THE WEEK

Stronger GDP Growth in 2017

GDP Growth by Quarter

The last three quarters’ growth rates significantly exceed the average growth rate of 2.2 percent since the recession ended and are better than the longer-run growth projections of 1.8% to 1.9% published in the Federal Reserve’s December 2017 Summary of Economic Projections and the Congressional Budget Office’s June 2017 10-Year Economic Projections.

2017’s improved economic performance runs counter to the notion of a “new normal” of slow growth. Instead, we are seeing that as Obama-era policies are reversed, America’s economic potential is being unleashed.

LAST WEEK

News & Commentary Weekly Highlights

Wall Street Journal: GDP Grew 2.6% at Year End, Extending Strong Stretch

Economics21: Hidden in New GDP Data: Good News for 2018 Growth

Fortune: CEO Optimism in the World Economy Has Reached a Record High

Washington Post: Senate confirms Powell for Fed chair, handing Trump’s pick enormous influence over the economy

JEC Releases

Paulsen: Upward Pivot of U.S. Economic Growth

GDP Review (Fourth Quarter 2017)

State Employment Reports

Top Economic Indicator Highlights

Gross Domestic Product (Fourth Quarter 2017—Advance Estimate)

Category	Q4-2017	Q3-2017	Q2-2017	Q1-2017
Real GDP, change from previous quarter at seasonally adjusted annualized rate	2.6%	3.2%	3.1%	1.2%

GDP Component Contributions

Noteworthy: In the last three quarters of 2017, real GDP growth exceeded the current economic expansion’s average of 2.2% growth. One of the most promising developments in 2017 was the resurgence in business fixed investment, which had shrunk in 2016. This is especially remarkable given that the immediate expensing of capital investment available under the Tax Cuts and Jobs Act is only now available to American businesses.