As measured by NY Fed WEI, OECD Weekly Tracker and Baumeister, Leiva-Leon and Sims WECI.
Figure 1: Lewis-Mertens-Stock (NY Fed) Weekly Economic Index (blue), Woloszko (OECD) Weekly Tracker (tan), Baumeister-Leiva-Leon-Sims Weekly Economic Conditions Index for US plus 2% trend (green) Source: NY Fed Going through Fred, OECD, WECIand the author’s calculations.
The WEI fell from the previous week, from 2.8% to 2.1%, while the Weekly Tracker continued to rise. The divergence, which is not surprising given the large differences in methodologies, has closed in recent weeks. The WEI relies on correlations in ten series available on a weekly basis (eg unemployment claims, fuel sales, retail sales). The Weekly Tracker – at 2.0% – is a “big data” approach that uses Google Trends and machine learning to track GDP.
The WEI reading for the week ending 10/1 of 2.1% is interpretable as quarterly growth of 2.1% if the 2.1% reading were to persist for an entire quarter. The 2% weekly OECD reading is interpretable as a 2% annual growth rate for the year ending 10/1 (this series has been revised down significantly from the last release). The Baumeister et al. a reading of 3.4% is interpreted as a growth rate 1.4% above the long-term trend growth rate. Average US GDP growth over the period 2000-19 is about 2%, implying a growth rate of 3.4% for the year ending 1/10.
Given that these are year-over-year growth rates, it is possible that we were in a recession in the first half, because an observer suggested just over a month ago, but it (still) seems unlikely.