Atlanta Federal Reserve GDPNow expects 5.1% adjusted annualized GDP growth for 3rd quarter

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Atlanta Fed GDPNow nowcasts Q3 U.S. GDP at 5.1% annualized, up from its own 4.4% estimate last week, on stronger consumption and government spending data. Official Q2 growth was 1.5% annualized.

For comparison:
China grew 4.3% year-over-year (0.9% quarter-on-quarter) in Q2
The euro area grew 1.2% year-over-year (0.6% quarter-on-quarter).

Over the past few years China has typically grown about 4.5–5.5% a year. The U.S. has typically grown about 2–3%.

China is decelerating. Year-over-year growth has slipped from the mid-5s in early 2025 to 4.3% in Q2 2026, the weakest quarterly pace since late 2022. Quarter-on-quarter growth also slowed, from 1.3% in Q1 to 0.9% in Q2.

The U.S. had been choppier quarter to quarter, but the level is now in a modest expansion range. Q2 cooled to 1.5% annualized after 2.1% in Q1.

The euro area has been the slowest of the three. Year-over-year growth has hovered near 1%, falling to 0.6% in Q1 2026 before recovering to 1.2% in Q2. Quarter-on-quarter growth was flat in Q1 and 0.6% in Q2. The ECB’s full-year 2026 projection is 0.9%.

In other words if the 5.1% holds, the U.S. would be growing faster this quarter than China has been growing recently.

This is why the Federal Reserve just raised the interest rates by 25 bps.