Monthly US GDP rose 1.4% in January. This was the first increase since October; monthly GDP declined in November and was essentially flat in December. The increase in January was essentially accounted for by a large increase in personal consumption expenditures (PCE). Outside of PCE, increases in other domestic final sales were roughly offset by decreases in net exports and nonfarm inventory investment. The level of GDP in January was 3.7% above the fourth-quarter average at an annual rate. Increases of 0.2% per month (not annualized) over February and March underlie our latest forecast of 4.5% annualized GDP growth in the first quarter.

IHS Markit's index of Monthly GDP (MGDP) is a monthly indicator of real aggregate output that is conceptually consistent with real Gross Domestic Product (GDP) in the National Income and Product Accounts. The Monthly GDP Index is consistent with the NIPAs for two reasons: first, MGDP is calculated using much of the same underlying monthly source data that is used in the calculation of GDP. Second, the method of aggregation to arrive at MGDP is similar to that for official GDP. Growth of MGDP at the monthly frequency is determined primarily by movements in the underlying monthly source data, and growth of MGDP at the quarterly frequency is nearly identical to growth of real GDP.

Posted 01 March 2021 by Ben Herzon, US Economist, Insights and Analysis, S&P Global Market Intelligence and

Kathleen Navin, Economics Executive Director, US Macroeconomics, S&P Global Market Intelligence