U.S. growth — better than most estimates

Zach Pandl, Portfolio Manager and Strategist | September 6, 2013

According to our proprietary measure of U.S. activity, underlying growth was 3.4% in August after 2.2% in July (July was revised down from the preliminary estimate of 2.5% due to revisions in the payroll report). The three-month average of monthly growth rates edged up to 2.6% from 2.2% last month.

As many of you know, the current narrative in the market about U.S. growth is significantly more downbeat than the message from our indicator. This reflects a greater focus on GDP by most analysts. While I think 3.4% probably overstates current growth momentum, I also believe the economy is doing better than the sub-2% growth rates seen in GDP bean counts from the street.

Columbia Management Activity Indicator (CMAI), % annualized growth

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Columbia Management Activity Indicator (CMAI), % annualized growth

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Read Zach’s article on Why GDP deserves less attention

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