After yesterday’s trade data, Morgan Stanley shaves their latest GDP number.Mixed report, with the trade deficit unchanged at an upwardly revised $45.6 billion in August on little change in both exports (-0.1%) and imports (0.0%). This was a somewhat worse result than we expected. But softness in exports relative to our expectations was accounted for by a decline in ex aircraft capital goods, and ex aircraft capital goods shipments were previously reported to have surged in August, so the decline in exports points to stronger domestic investment. We now see Q3 GDP growth tracking at +3.1% instead of +3.2%, with a smaller contribution from net exports but stronger domestic demand.
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