The Atlanta Fed just slashed its GDP outlook

It looks like the second quarter is going to be just another period of slow growth in the United States.

Despite high hopes that gross domestic product gains might approach 3 percent, recent data indicate that the number, which will be reported Friday, will be considerably lower.

The Atlanta Fed, in its closely watched GDPNow indicator, on Thursday cut its forecast to 1.8 percent, a sharp reduction from the 2.3 percent expectation just a day earlier. Wall Street economists project the number to come in around 2.6 percent, according to FactSet.

If the Fed number is correct, that would put average growth for the first half of 2016 at just 1.45 percent, and just shy of 1.6 percent over the past four quarters.

As recently as May 31, the Fed tracker was looking for a growth rate of 2.9 percent, but that's been on a steady decline since.

It was the second time this week that the indicator fell; the first was Wednesday after durable goods orders came in lower than expected, while Thursday's reduction was based on the first release of the U.S. Census Bureau's new advance economic indicators report, which logs retail and wholesale inventories as well as foreign trade in goods.

Atlanta Fed officials noted that the report showed negative impacts from exports and inventory investment.

The cut comes a day after the Federal Open Market Committee, the central bank's monetary policymaking arm, issued a more optimistic outlook on the economy.

Despite the fairly positive FOMC language, particularly on the labor market, traders anticipate only a slightly higher chance of a rate hike in 2016 than they did before the meeting. The fed funds futures market now indicates a 24 percent chance of an increase at the September Fed meeting, and a 50.5 percent chance of a move by year's end.

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