This from Barclays on the July - September preliminary economc growth data
(in brief, bolding mine)
growth in Q3 reflected
- a 0.5pp positive contribution from net exports
- and a 0.2pp negative contribution from domestic demand
Notably, real private consumption fell in line with expectations after surging in Q2
- while real exports showed firm growth again after undergoing a speed adjustment in Q2
We expect public investment to fall in Q4, as it did in Q3, with earlier stimulus measures running their course
Nominal employee compensation increased 2.1% q/q (Q2: 2.1%), sustaining the strong growth seen in the previous quarter
- Given this and the improvements in consumer sentiment, we look for private consumption to turn up q/q in Q4
In other areas of domestic demand,
- private capex increased 0.2% q/q (Q2: 0.5%), a fourth consecutive gain
- Housing investment fell 0.9% q/q (Q2: 1.1%), the first decline in seven quarters
- Meanwhile, public fixed capital formation (public investment) decreased 2.5% q/q in Q3 (Q2: 5.8%), the first decline in three quarters. We believe such investment is likely to continue falling in Q4.
The GDP deflator rose 0.1% y/y in Q3 (Q2: -0.4%), exceeding the previous year's level for the first time in five quarters,
- while the deflator of household final consumption expenditure (excluding imputed rent), which resembles the CPI, strengthened to 0.4% y/y (Q2: 0.2% y/y)
- Although the GDP deflator could once again fall y/y in Q4 on acceleration in the import deflator due to rising oil prices, the deflator of household final consumption expenditure should remain positive.
Q4 GDP outlook ... We expect an eighth consecutive quarter of positive growth
- We expect public investment to show a somewhat steeper reactionary decline in Q4, weighing on GDP growth.
- However, given the improvements in consumer sentiment and firm overseas demand, we look for q/q increases in both private consumption and exports to support an eighth consecutive quarter of growth in Q4.