US GDP Growth Revised Higher to 4.2% in Q2


The US economy advanced an annualized 4.2 percent on quarter in the second quarter of 2018, slightly higher than a preliminary reading of 4.1 percent and beating market forecasts of 4 percent, the second estimate showed. It is the highest growth rate since the third quarter of 2014, as nonresidential fixed investment rose more than anticipated, mainly boosted by software and information processing equipment and imports fell, mainly due to petroleum.

Personal consumption expenditure (PCE) contributed 2.55 percentage points to growth (2.69 percentage points in the first estimate) and rose 3.8 percent (4 percent in the first estimate). Spending on both durables (8.6 percent compared to 9.3 percent in the first estimate) and nondurable goods (3.7 percent compared to 4.2 percent) rose less than expected while services growth matched estimates (at 3.1 percent).

Fixed investment added 1.07 percentage points to growth (0.94 percentage points in the first estimate) and increased 6.2 percent (5.4 percent in the first estimate). Investment rose more than anticipated for equipment (4.4 percent compared to 3.9 percent) and intellectual property products (11 percent compared to 8.2 percent) but increased slightly less for structures (13.2 percent compared to 13.3 percent) and fell more for residential (-1.6 percent compared to -1.1 percent).

The contribution from private inventories was -0.97 percent, compared to -1 percent in the first estimate. 

Exports jumped 9.1 percent (9.3 percent in the first estimate) and imports declined 0.4 percent (+0.5 percent in the first estimate). As a result, the impact from trade was 1.17 percent, better than 1.06 percent in the first estimate and the highest contribution since the last three months of 2013.

Government spending and investment added 0.41 percentage points to growth, slightly higher than 0.37 percentage points in the first estimate. It increased 2.3 percent, above 2.1 percent in the previous release.

US GDP Growth Revised Higher to 4.2% in Q2


BEA | Joana Taborda | joana.taborda@tradingeconomics.com
8/29/2018 1:15:46 PM