(click to enlarge)
Today's revision to third quarter GDP was meaningful, since it boosted both real growth and inflation by meaningful increments. As a result, nominal GDP growth (annualized) for the quarter was 5.6%, up from the previously reported 4.7%. As the chart above shows, nominal GDP growth in the third quarter now looks to be among the strongest in the current business cycle expansion.
If the Fed has been trying hard to boost real and nominal GDP growth and avoid deflation, they are certainly not failing at the task. Since the recovery started (mid-2009), nominal GDP growth has been an annualized 3.9%. Last quarter's growth rate of 4.7% is meaningfully higher, and the trend in the past three quarters has been definitely higher. Real growth since the recovery started has been an annualized 2.3%, and last quarter's growth of 3.5% was substantially better; real growth has also been picking