Weekly Market Commentary 10/27/2017

The long-standing divergence between soft and hard data continues to narrow, as the economy delivered another solid performance in the third quarter. For the first time since 2014, GDP posted a 3% growth rate or better for two consecutive quarters, a performance that belies the widespread perception that the new normal for growth is mired at 2%. To be sure, Friday’s report of a 3.0% reading for the third quarter – which follows a 3.1% pace in the second quarter – is a preliminary estimate that could be substantially revised in either direction as more information becomes available in coming months. That said, the headline growth rate exceeded expectations for the period, which most economists predicted would range from the low 2s to 2.7%.