Buy Bonds Is Signal From Atlanta Fed Model Showing Cooling GDP
- Fed bank's model signals Q3 economic growth rate of 0.8%
- Consensus Wall Street forecast is for expansion of 1.5%
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Treasury bulls, take heart: Even as U.S. central bankers debate this week whether to raise interest rates for the first time since 2006, a model developed by a regional Federal Reserve bank says the economy is losing steam.
The forecasting tool, created by the Atlanta Fed and called GDPNow, has been prescient this year in estimating gross domestic product and signaling a path for 10-year yields. It was more accurate than Wall Street in predicting preliminary growth in the first and second quarter, and it’s suggesting most analysts may be too optimistic on the economy before the Oct. 29 release of data for July through September.