US Q1 GDP Growth Revised Up to 1.1%


The US economy expanded an annualized 1.1 percent on quarter in the first three months of 2016, higher than a second estimate of 0.8 percent, according to final figures released by the Bureau of Economic Analysis. Consumer spending continued to boost growth although it expanded less than expected while exports and software investment rebounded.

Personal consumption expenditure (PCE) contributed 1.02 percentage points to growth (1.29 percent in the second estimate), the lowest contribution in two years. It went up 1.5 percent, below 1.9 percent in the second estimate and also the lowest growth rate since the first quarter of 2014. Spending on durable goods (-1.6 percent from -1.2 percent in the second estimate) fell more than expected and consumption of both nondurable goods (1 percent from 1.3 percent in the second estimate) and services (2.1 percent from 2.6 percent in the second estimate) rose less than anticipated. 

Fixed investment subtracted 0.06 percentage points to growth (-0.25 percent in the second estimate) and shrank 0.4 percent (-1.5 percent in the second estimate). Nonresidential investment declined at a slower 4.5 percent (-6.2 percent in the second estimate): structures fell less (-7.9 percent from -8.9 percent in the second estimate) while investment in intellectual property products jumped 4.4 percent (compared to a 0.1 percent fall in the second estimate). Residential investment increased 15.6 percent, slightly below a 17.1 percent rise in the second estimate. 

Private inventories subtracted 0.23 percentage points from the growth, compared to a 0.2 percentage points decrease earlier estimated. Businesses accumulated $68.3 billion worth of inventory, compared to $69.6 billion earlier reported. 

Meanwhile, export growth was revised to show a 0.3 percent gain instead of a 2 percent fall in the second estimate. Imports contracted at a faster 0.5 percent (-0.2 percent in the second estimate), thus brining net trade contribution to growth up to 0.12 percent (-0.21 percent in the second estimate)

Government spending and investment added 0.23 percentage points to growth, slightly up from 0.2 percent earlier reported the same as in the advance estimate.

BEA | Joana Taborda | joana.taborda@tradingeconomics.com
6/28/2016 1:56:13 PM