The unrevised 33.1% U.S. Q3 GDP gain

The unrevised 33.1% U.S. Q3 GDP gain was disappointing thanks to the lack of a big upward revision in consumption that defied big retail sales revisions, a -$3.4 B downward inventory bump despite a expected big increase, and a $5.6 B trimming for net exports despite an expected small boost. Analysts otherwise saw the expected small boosts for both business and residential fixed investment, and a trimming in government purchases, leaving final sales growth at a slightly revised 25.6% (was 25.5%). The revisions still leave a record-setting Q3 GDP growth rate that is nearly double the 16.7% prior high in Q1 of 1950. The bounce reversed 66% of the GDP plunge in Q1-Q2, and leaves GDP -3.5% below the level in Q3 of 2019. The revised GDP data still reveal a powerful Q3 rebound led by household consumption and residential investment, alongside a big bounce in equipment spending and a rapid reversal of the out-sized Q2 inventory liquidation rate. The Q3 bounce was restrained by a powerful surge in imports that sharply exceeded the bounce in exports, as much of the U.S. inventory build was fed by imported goods, alongside weakness in nonresidential investment in structures. Analysts also saw a Q3 drop-back in government purchases after a CARES Act boost in Q2, though most of the CARES Act expenditures were transfer payments that don't enter this GDP component. Analysts will leave our Q4 GDP estimate at 6.4% for now.