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Kudlow: US GDP Figure Will Be 'Big'

Kudlow & Co., LLC

By    |   Thursday, 26 July 2018 02:32 PM

White House economic adviser Larry Kudlow said Friday's GDP release will reflect "big" growth for the U.S. economy.

“You’re going to get a very good economic growth number tomorrow, big,” Kudlow told Fox Business Network.

The GDP report is due Friday from the Commerce Department.

When asked if he was allowed to speculate on the report, Kudlow, who served as the Trump campaign's senior economic adviser, said he “would never do such a thing. I just wanted to bring it up, again to help you in this interview.”

Economists surveyed by Reuters expect the gain to be 4.2 percent, a range the veteran financial guru and former Ronald Reagan adviser says sounds about right, although he said he didn't have any official information about the report before the Fox appearance.

"I have no reason to disagree with that, but I have no knowledge, no information," said Kudlow, the head of the National Economic Council that advises President Donald Trump,

"We won't hear about that until way later today," said Kudlow, who worked as Reagan’s budget deputy between 1981 and 1985.

Meanwhile, orders placed with U.S. factories for business equipment increased in June for a third straight month, a sign of investment momentum heading into the second half despite corporate concerns over tariffs, Commerce Department figures showed Thursday.

The latest economic data signal business investment remains firm even as Trump widens a global trade war beyond steel and aluminum and into a growing range of products from China, as well as potential levies on autos.

Business spending, which is getting a boost from lower corporate taxes, is one of the factors supporting a projected pickup in second-quarter economic growth.

At the same time, the uncertainty over trade policy may spur some companies to slow investment, resulting in a hit to economic growth in the second half or later. Companies including General Motors are citing higher prices for steel and aluminum - - the metals subject to import levies -- as impacting their business.

After a report on durable-goods orders, along with data showing a wider merchandise-trade deficit in June and weaker-than-expected inventories, several estimates of second-quarter GDP growth declined.

Economists are figuring GDP for the three-month period to come in at 4.1 percent for the first reading, according to a Reuters survey. If that happens, it will be the best single-quarter reading since the third quarter of 2014, when growth registered a 5.2 percent gain, the high-water point during Barack Obama's presidency, CNBC explained.

Estimates vary on what the final number would be Friday. Barclays is on the high end with a 5.2 percent forecast, while CNBC's Rapid Update survey of top economists sees a 4.2 percent increase. The Atlanta Fed is tracking at 3.8 percent, while the New York Fed is on the low end at 2.7 percent.

JPMorgan Chase & Co. cut its projection to 3.9 percent from 4.4 percent, while the median estimate in Bloomberg’s survey remained at 4.2 percent.

Meanwhile, Kudlow also said that European Commission President Jean-Claude Juncker had pledged to U.S. President Donald Trump that he would help the United States confront China over its trade practices.

Kudlow also told Fox Business Network that the European Union would immediately begin work on increased purchases of American soybeans, beef and liquefied natural gas.

"U.S. and EU will be allied in the fight against China, which has broken the world trading system, in effect," Kudlow said. "President Juncker made it very clear yesterday that he intended to help us, President Trump on the China problem."

(Newsmax wire services Reuters and Bloomberg contributed to this report).

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Economy
White House economic adviser Larry Kudlow said Friday's GDP release will reflect "big" growth for the U.S. economy.
kudlow, gdp, big, trump, china, eu, economy
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2018-32-26
Thursday, 26 July 2018 02:32 PM
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