From Karim:

• GDP slows from 4.9% to 0.6%
• Personal consumption slows from 2.8% to 2.5%
• DGO strength in Dec shows up in modest positive in equipment and software (+3.8%)
• Residential FI (housing) down 23.9%
• Core PCE up 2.7% annualized for quarter and 2.1% y/y
• Net exports add 0.4% to gwth
• Inventories a drag by 1.25%
• Inventory/shipment ratio still at recent highs, so unlikely that inventory drag is over yet

• ADP gain of 130k signals upside risk to consensus 65k advance in nfp; while usually reliable, adp has also had some spectacular misses

• In light of decline in jobs hard to get component of conference board survey and adp, will call for 90k gain in nfp Friday.

• Pretty long period between jan and march fed meetings (next meeting march 21). So by next meeting, will have 2 nfp reports to look at as well as decent idea on Q1 gwth. Bernanke testimony likely on 2/27.

♥