Mon March 5, 2018

The second estimate of fourth quarter 2017 real GDP came in marginally lower at 2.5 percent from the 2.6 percent advance estimate, according to the U.S. Bureau of Economic Analysis (BEA). Positive data points for the plastics industry in the fourth quarter, as reported in the advance estimate, have not changed significantly—except in housing.

The personal consumption expenditures on both durable and nondurable goods rose 13.8 percent and 4.3 percent, respectively—slightly lower than the 14.2 percent and 5.2 percent previous estimates. Business investment spending on equipment was revised upward from 11.4 percent to 11.8 percent. Residential fixed investment spending—housing—was also revised higher from 11.6 percent to 13.0 percent.

The  recent report indicated that the plastics industry’s most important end markets performed well in the final quarter of last year—and throughout the entire year. In current-dollar terms—without adjusting for price distortion—GDP rose 4.1 percent last year, according to the BEA. For these reasons, and others, we should expect upbeat corporate profits for the fourth quarter of 2017 and for last year as a whole. That’s a good way for the U.S. to close 2017 and certainly a positive starting point for 2018 for the world’s largest economy.