Recent partial indicators of economic activity for the United States have generally been positive with solid, if not strong, readings for total consumption, business investment, and exports. This is a positive for December quarter GDP, for which the advance estimate will be released at the end of the month. Moreover, while still not expected to match the very strong September quarter pace, inventory accumulation has been greater than we expected so far during the quarter. As a result we have revised up our forecast of December quarter GDP, and we now expect growth of 0.7% qoq (3.0% annualised rate). While this would be a slower growth rate than in the September quarter, if the contribution from inventories is excluded – which gives a better guide to the underlying strength of demand – such a result would indicate that the economy strengthened at the end of 2013
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