Figure 1: Nonfarm payroll employment (dark blue), Bloomberg consensus since 10/4 for NFP (blue +), civilian work (orange), commercial production (red), personal earnings omitting transfers in Ch.2012$ (green), production and trade sales in Ch.2012$ (black), intake in Ch.2012$ (light blue), and regular monthly GDP in Ch.2012$ (pink), main GDP (blue bars), all log normalized to 2021M11= 0. Lilac shading signifies dates connected with a hypothetical recession in H1. Source: BLS, Federal Reserve, BEA, through FRED, IHS Markit (nee Macroeconomic Advisers) (10/4/2022 release), and authors calculations.
Keep in mind that month-to-month GDP went up dramatically in September. From IHS-Markit:
Monthly GDP rose 0.8% in August following a 0.2% boost in July. The sharp gain in stock investment in August is most likely to be reversed in September, as inventories (outside of motor vehicles and parts), by our estimate, were currently somewhat overbuilt heading into August.
GDP and other indicators appear to be at variation; nevertheless, if we look at GDO, they appear more constant.
With September IHS-Markit (Macroeconomic Advisers) regular monthly GDP, we have the following image of some essential indicators followed by the NBER Service Cycle Dating Committee.
Figure 2: Nonfarm payroll work (dark blue), Bloomberg agreement of 10/14 (blue +), civilian work (orange), industrial production (red), individual earnings leaving out transfers in Ch.2012$ (green), production and trade sales in Ch.2012$ (black), intake in Ch.2012$ (light blue), and regular monthly GDP in Ch.2012$ (pink), Gross Domestic Output, GDO (blue bars), all log stabilized to 2021M11=0. Lilac shading represents dates associated with a hypothetical recession in H1. Source: BLS, Federal Reserve, BEA, through FRED, IHS Markit (nee Macroeconomic Advisers) (10/4/2022 release), and authors computations.
For more discussion of GDP vs. GDO and other related measures, see this post from the beginning of the month, and discussion of GDP yearly revision, here.
With consumption, production and work steps increasing throughout H1, and GDO trending sideways, it does not promise that H1 will be stated an economic downturn, defined as a broad based and consistent decrease in financial activity.
Figure 1: Nonfarm payroll work (dark blue), Bloomberg consensus as of 10/4 for NFP (blue +), civilian work (orange), industrial production (red), individual earnings excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), intake in Ch.2012$ (light blue), and month-to-month GDP in Ch.2012$ (pink), main GDP (blue bars), all log normalized to 2021M11= 0. Month-to-month GDP increased 0.8% in August following a 0.2% boost in July. Figure 2: Nonfarm payroll work (dark blue), Bloomberg consensus of 10/14 (blue +), civilian work (orange), industrial production (red), personal income leaving out transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), consumption in Ch.2012$ (light blue), and regular monthly GDP in Ch.2012$ (pink), Gross Domestic Output, GDO (blue bars), all log stabilized to 2021M11=0.
