GDP and Jobs

Some positive improvement but still below expectations

One of my favorite models, GDPNow, had been pretty bullish on real GDP for 2020Q4 the past few weeks:

While the model ended with a best guess of 7.2%, actual real GDP came in at 4.0%:

This leaves us still a good bit away from the 2019Q4 peak one year ago. Meanwhile, further gains in the economy are expected to be slow, especially with so many people still filing for unemployment:

The positive note is that continuing unemployment claims continue to drop, even if the improvement is coming at a painfully slow rate:

Overall, the economy and job market remain in tough shape. It’s been a long year and we’re going to have to continue waiting before we will see the 2019 levels once again.

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