More proof of a strong economy as 2023 ended. Tomorrow tells us more about 2024.

After a strong initial report, we got an updated look at how much the economy grew in the last 3 months of 2023. And an already-good picture may have gotten slightly brighter after this GDP report came out.

US Q4’23 GDP: revised down on slower inventory build to 3.2%. But a look under the hood suggests momentum was building into Q1’24. Consumption revised up to 3%, real final sales to 3.5% from 3.2%, final sales to domestic purchases to 3.1% from 2.7%-which excludes inventories &…

— Joseph Brusuelas (@joebrusuelas) February 28, 2024

Today's #Economic Indicator Results

GDP (Revised): 3.2% vs 3.3% est.🔴

Personal Consumption: 3.0% vs 2.7% est.🟢

GDP Price Index: 1.6% vs 1.5% est.🟢

Core PCE Price Index: 2.1% vs 2.0% est.🟢

Wholesale Inventories: -0.1% vs 0.2% est.🔴

— Markets Today (@marketsday) February 28, 2024

I don't see how a 0.1% change here or there changes what the overall story was for a strong 4th Quarter in the US economy. Consumption was revised up a little more than that, which to me is possibly the one significant revision to note with this, as it matches the positive vibes that were emerging in much of the US. But we've also seen some soft numbers in retal sales and other areas for January, and that's what I care about a lot more than what might have been happening 8 weeks ago.

If you're still on INFLATION WATCH, I suppose you could be concerned about increased spending and lower inventories. But that's also the "good reason" for inflation, as it shows strong demand, and a need to keep adding products and workers to meet it.

We'll get an updated picture of January's data with the income and spending report, which will come out tomorrow. And the PCE and spending figures for that one will be what Wall Streeters are going to react to as they try to front-run when the Fed will (or won't) lower rates this year. Along with unemployment claims, it feels like Leap Day will also be a big data day if you're trying to get a gauge on where the economy is, and may be going.