Economic Analysis First Quarter 2017

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Consumers are more confident. Stocks are up 5 percent since the start of the year. And from the president on down, there’s talk of a Trump bump.

The only problem: The boom is apparent everywhere except in the economic data.

It’s not that the economy is stalling — far from it. But with the first quarter ending Friday, growth in the first three months of the Trump administration is looking much the way it did under President Barack Obama.

In fact, experts see the gross domestic product in the quarter coming in at only about 1 percent, on an annualized basis — less than half the pace in the second half of 2016, and a far cry from President Trump’s own 4 percent target.

“There is a temporal disconnect,” said Ellen Zentner, chief United States economist at Morgan Stanley. “There has been an incredible rise in sentiment, but the proof is in the pudding later.”

Ms. Zentner expects growth of 1 percent this quarter, and considers recent data “solid,” but added that the big gap between expectations and reality “creates discomfort for economists and monetary policy makers.”

“The divergence is stunning,” she added, drawing a distinction between “soft data” like consumer confidence and “hard data” like retail sales.

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