Atlanta Fed GDPNow Sees Economy Shrinking After Friday Data

The US economy is setting up to take a major step back in the first quarter after a pair of reports showed weaker consumer spending and a dramatic widening of the trade deficit at the start of the year, according to the Federal Reserve Bank of Atlanta’s latest GDPNow forecast.

Gross domestic product is seen declining an annualized 1.5% in the current quarter, representing a sizable markdown from the 2.3% pace of growth expected just days ago. To be sure, it’s still early in the quarter, and the GDPNow estimate will get updated to incorporate more monthly data when ...