Preview: Due August 26 - U.S. Preliminary (Second) Estimate Q2 GDP - Small upward revision, still subdued

We expect the largest revision by component to come from private non-residential structures, though it will remain negative. A small upward revision to equipment is likely to add to the overall upward revision to business investment, making it increasingly positive. Public construction is also likely to see a small upward revision, as are inventories.

Weighing against this are likely modest downward revisions to retail sales and housing investment. Net exports are also likely to see a marginal downward revision due to service exports being revised up by more than service imports.  We expect final sales (GDP less inventories) to be unrevised at 2.2% though with a small upward revision in USD terms. We expect final sales to domestic buyers (GDP less inventories and net exports) to be revised up to 3.2% from 3.1%.

We do not expect any revisions to the price indices, of 6.2% for GDP, 5.1% for PCE and 3.4% for core PCE. The economy is now showing subdued growth with firm inflation.