{"id":58721,"date":"2026-02-18T12:08:41","date_gmt":"2026-02-18T16:08:41","guid":{"rendered":"https:\/\/stockmarketwatch.com\/stock-market-news\/atlanta-fed-gdpnow-q4-estimate-revised-downward-to-3-6-amid-mixed-economic-data\/58721\/"},"modified":"2026-02-18T12:08:41","modified_gmt":"2026-02-18T16:08:41","slug":"atlanta-fed-gdpnow-q4-estimate-revised-downward-to-3-6-amid-mixed-economic-data","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/atlanta-fed-gdpnow-q4-estimate-revised-downward-to-3-6-amid-mixed-economic-data\/58721\/","title":{"rendered":"Atlanta Fed GDPNow Q4 Estimate Revised Downward to 3.6% Amid Mixed Economic Data"},"content":{"rendered":"<h2>Key Takeaways<\/h2>\n<ul>\n<li><strong>The Atlanta Fed&#39;s GDPNow model revised its Q4 2025 real GDP growth estimate to 3.6% on February 18, a slight decrease from the previous 3.7% forecast.<\/strong><\/li>\n<li><strong>The adjustment follows the release of critical economic data, including January industrial production which rose 0.7%, and delayed December housing starts data.<\/strong><\/li>\n<li><strong>Despite the marginal decline, the 3.6% projection remains well above the initial 3.0% estimate from late 2025, suggesting a resilient &quot;no landing&quot; scenario for the U.S. economy.<\/strong><\/li>\n<li><strong>Market focus remains on the Federal Reserve&#39;s next move, with the current federal funds rate held at 3.5%\u20133.75% and speculation mounting over a potential rate cut in mid-2026.<\/strong><\/li>\n<\/ul>\n<p>The <strong>Federal Reserve Bank of Atlanta<\/strong> updated its <strong>GDPNow<\/strong> model on Wednesday, lowering the &quot;nowcast&quot; for <strong>fourth-quarter 2025 real GDP growth<\/strong> to <strong>3.6%<\/strong>. This revision from the previous <strong>3.7%<\/strong> estimate reflects the latest integration of data from the <strong>U.S. Census Bureau<\/strong> and the <strong>Federal Reserve Board of Governors<\/strong>. While the headline figure saw a minor dip, the broader trend continues to point toward a robust expansion that has consistently outperformed early-quarter expectations.<\/p>\n<p>The update was primarily influenced by a flurry of economic reports that had been delayed due to a <strong>43-day government shutdown<\/strong> earlier in the reporting cycle. On Wednesday, the <strong>Federal Reserve<\/strong> reported that <strong>industrial production<\/strong> in January climbed by <strong>0.7%<\/strong>, surpassing the <strong>0.4%<\/strong> growth expected by economists. This surge was driven by a <strong>2.1%<\/strong> jump in utilities output and a <strong>0.6%<\/strong> increase in manufacturing, the largest gain for the sector in nearly a year.<\/p>\n<p>Simultaneously, the <strong>U.S. Census Bureau<\/strong> released long-awaited residential construction data. <strong>Housing starts<\/strong> for December were reported at a seasonally adjusted annual rate of <strong>1.404 million<\/strong>, representing a <strong>6.2%<\/strong> increase from November. <strong>Building permits<\/strong> also saw a healthy rise of <strong>4.3%<\/strong> to <strong>1.448 million<\/strong>. These figures suggest that the housing market remained active through the end of 2025 despite high borrowing costs and the temporary lapse in federal services.<\/p>\n<p>The slight downward revision in the overall GDP estimate likely stems from internal model adjustments to <strong>real personal consumption expenditures<\/strong> and <strong>real gross private domestic investment<\/strong>. Analysts noted that while production and housing remain strong, <strong>retail sales<\/strong> data from December had been relatively flat, dragging on the consumption component of the model. This &quot;K-shaped&quot; economic recovery has seen steady spending from higher-income households while lower- and middle-income consumers face increasing financial stress.<\/p>\n<p>Investor sentiment remains cautiously optimistic as the <strong>Federal Reserve<\/strong> maintains a &quot;data-dependent&quot; stance. Following the January meeting where rates were held steady at <strong>3.5%\u20133.75%<\/strong>, the market is now pricing in a roughly <strong>60%<\/strong> chance of a rate cut by June 2026. The nomination of <strong>Kevin Warsh<\/strong> as the potential new Fed Chair has added a layer of uncertainty to the long-term monetary outlook, though current Chair <strong>Jerome Powell<\/strong> has emphasized that the economy is entering 2026 on a &quot;firm footing.&quot;<\/p>\n<p>Large-cap technology stocks, particularly those tied to the AI revolution like <strong>Nvidia<\/strong> (<a href=\"\/stock\/NVDA\">NVDA<\/a>), continue to serve as a primary engine for productivity gains that are supporting these higher-than-average GDP forecasts. As the <strong>Bureau of Economic Analysis (BEA)<\/strong> prepares to release its official &quot;advance&quot; estimate for Q4 GDP later this week, the <strong>Atlanta Fed&#39;s<\/strong> 3.6% figure will serve as a critical benchmark for market expectations.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways The Atlanta Fed&#39;s GDPNow model revised its Q4 2025 real GDP growth estimate to 3.6% on February 18, [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":50383,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center 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