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Ton of data released before the holiday. Revised 3rd quarter Gross Domestic Product (GDP) showed the economy grew to an annualized rate of $23.4 trillion, adjusted for inflation. Another record high.

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This represents an annualized growth rate of +2.8%, which comes in exactly where the street was expecting and exactly the same as the 1st estimate. The historical average is +3.2% (orange line), so Q3 saw slightly below average growth and a modest slow down from Q2 (+3.0%).

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The economy grew +2.7% over last year, below the historical average (also +3.2%) and Q2’s +3.0%.

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The GDP price index (inflation) continues to decelerate. Prices rose at a 2.2% rate, down sharply from the 7.7% rate in Q2 2022.

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Also within the report, we got an updated look at corporate profits. Q3 came in at $3.8 trillion, slightly below the all time high from Q2 of $3.82 trillion. Corporate profits are up about 6.1% over last year.

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Personal Consumption Expenditures minus food and energy (core PCE) came in as expected, at +0.3% for the month of October. Core PCE is up +2.8% over the last 12 months. A slight uptick from last months +2.7%. Core PCE is the Fed’s preferred measure of inflation, it can’t seem to get below the +2.6% level, which remains above the Fed’s objective of price stability.

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Personal income came in above estimates at 0.6% for October (street expected 0.3%). Incomes rose +5.3% over the last 12 months.

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Adjusting for inflation, incomes still rose +2.9% over the last 12 months.

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Personal spending came in as expected, at +0.4% for October. And +5.4% over the last 12 months.

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Adjusting for inflation, consumer spending came in at +3.0% over the last 12 months. Since consumer spending makes up roughly 2/3rds of GDP, this is a positive start for Q4.

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