We expect GDP growth to slow sharply from 4.9% in the 3rd quarter to roughly 1% in both the 4th quarter of 2023 and 1st quarter of 2024, with a 1.61% annual GDP growth for the year 2023.

More than half of the deceleration in the 4th quarter is due to inventory investment, a development that would not be too surprising given the elevated pace of inventory building in the 3rd quarter. The idling of several auto assembly plants from mid-September through most of October also contributed to the slowdown in inventory investment, even as sales remained in line with recent averages. This resulted from the UAW’s strike, which now appears to be resolved.