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Another blast of imports and a poor spending report impacted the Nowcast.

Pat Higgins at GDPNow has made official adjustments to its model to account for gold imports.

The base model doesn’t adjust for gold imports/exports but the BEA does.

Gold bars and bullion are considered financial assets and gold imports have soared along with other imports, front-running tariffs.

For discussion, please see my March 27, 2025 GDPNow Discussion.

What Now?

Two reports caused the decline from March 26 to March 28.

There was another blast of imports on March 27 in the Census import-export data, and today the BEA reported personal income and spending.

The Nowcast does not attribute changes to specific report, but I take a crack at that below.

Contribution Changes

• PCE Goods: From -0.13 to -0.39 BEA (Net -0.28 PP)
• PCE Services: From 0.43 to 0.59 BEA (Net +0.16 PP)
• Change in Net Exports: From -3.95 to -4.79 Census (Net -0.84 PP)
• Fixed Investment: From 0.91 to 1.06 Census (Net +0.15)
• Total above: -0.81 Percentage Points

There were other minor changes taking the NowCast down by 0.7 PP.

The report shows Change in Private Inventories (CIPI) went from 0.60 to 0.41.

The difference between the Nowcast an Real final sales is CIPI which nets to zero over time.

This is why RFS only declined by 0.5 PP from -0.4 percent to -0.9 percent while the Nowcast fared worse, declining by 0.7 PP from +0.2 percent to -0.7 percent.

The number that matters is Real Final Sales, now -0.9 percent.

Related Posts

March 27, 2025: Second Massive Wave of Imports Shows More Tariff Front Running

The advance import-export data for February is another doozie. Three charts.

March 28, 2025: Real Disposable Personal Income Up 0.5%, Real Spending Up 0.1% in February

Consumers seem to be hunkering down in February as income outpaces spending.

Both reports were negative to GDPNow.

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