SPVM - Consumers Splurge On Services Fixed Investment Surges Imports Drag On GDP And There's A Blip In Government Spending

2024-04-26 08:35:00 ET

Summary

• In Q1 2024, consumers spent very vigorously on services at the fastest growth rate since 2021, adjusted for inflation, but not so vigorously on goods.
• Dragging on GDP were the trade deficit, which worsened sharply on a majestic surge of imports, and federal government consumption expenditure and investment, after five quarterly spikes in a row.
• We think that the slowdown in government spending was just a blip because we don’t see a slowdown in that department.

In Q1 2024, our consumers spent very vigorously on services at the fastest growth rate since 2021, adjusted for inflation, but not so vigorously on goods. And private fixed investment jumped at the fastest rate in two years....

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