Monthly GDP rose 0.7% in October following a 0.8% increase in September that was revised lower by 0.2 percentage point. The October increase reflected positive contributions from domestic final sales (mainly personal consumption expenditures and fixed investment) and nonfarm inventory investment that were only partially offset by a decline in net exports. Monthly GDP has climbed steadily over the last few months, albeit at a slower pace than over May and June, when the broad economy was reopening. Implicit in our latest tracking forecast of 6.0% annualized GDP growth in the fourth quarter is a further deceleration in monthly GDP averaged over November and December.

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 December 2020 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