by Bill McBride on 10/26/2012 08:38:00 AM
Friday, October 26, 2012
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 2.0 percent in the third quarter of 2012 (that is, from the second quarter to the third quarter), according to the "advance" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 1.3 percent.Click on graph for larger image.
The increase in real GDP in the third quarter primarily reflected positive contributions from personal consumption expenditures (PCE), federal government spending, and residential fixed investment that were partly offset by negative contributions from exports, nonresidential fixed investment, and private inventory investment. Imports, which are a subtraction in the calculation of GDP, decreased.
The acceleration in real GDP in the third quarter primarily reflected an upturn in federal government spending, a downturn in imports, an acceleration in PCE, a smaller decrease in private inventory investment, an acceleration in residential fixed investment, and a smaller decrease in state and local government spending that were partly offset by downturns in exports and in nonresidential fixed investment.
This graph shows the quarterly real GDP growth (at an annual rate) for the last 30 years.
The Red column (and dashed line) is the advance estimate for Q3 GDP.
A few comments:
• Consumer spending picked up a little. Real personal consumption expenditures increased 2.0 percent in the third quarter, compared with an increase of 1.5 percent in the second.
• Residential investment increased. Real residential fixed investment increased 14.4 percent, compared with an increase of 8.5 percent.
• State and local government made a negative contribution to GDP for the twelfth straight quarter, but the negative contribution was very minor.
This was slightly above expectations. I'll have more on GDP later ...
Posted by Bill McBride on 10/26/2012 08:38:00 AM