Last week, before the full devastation from Hurricane Harvey was unveiled, Goldman and JPM were the first banks to suggest that the storm’s impact on US GDP would be modest: a slight decline in Q3 growth, offset by a similary modest rebound in Q4 and further as emergency funds “trickled down” through the economy. Now, with more clarity on just how destructive the storm has been, other banks are coming out and they are not nearly as confident that the damage from Harvey will be “modest” – in fact, according to a just released analysis from Bank of America, Harvey will result in at least a 0.4% hit to Q3 GDP, which has reduced BofA’s Q3 GDP estimate to 2.5%…. and that excludes Irma.
Here’s Michelle Meyer explaining why in just a few weeks, all the economic misses will be blamed on, you guessed it, hurricanes.
First came Harvey, next comes Irma Hurricane Harvey crashed down on the shores of Texas, leaving behind record flooding and destruction. According to early estimates, Harvey may end up being the most expensive natural disaster in the US since 1980, costing $70-108bn (Table of the day). Thousands of people have been impacted. We are now actively monitoring Hurricane Irma, which threatens to hit the coast of Florida over the weekend.
This post was published at Zero Hedge on Sep 8, 2017.
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