The NY Fed staff has developed a good nowcast for GDP that effectively competes with the Atlanta Fed GDPnow forecasts. These are good tools for extrapolating current economic data into a GDP forecast.
It is a little tricky to look at these numbers the first time. The NY Fed nowcasts GDP during the quarter and during the calculation period (the beige colored area), The prior quarter is in green, and the next quarter is in purple. Given how information is generated, the Fed will track the first quarter through the first month of the second quarter. Clearly, the first quarter was predicted to be very strong. Second quarter is expected to come in weaker but still above long-term trends. There may be a reason to see some tempering in financial markets in the second quarter, but the growth still strongly supports holding risk assets.
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