US GDP Growth Revised Up to 1.4% in Q2


The US economy expanded an annualized 1.4 percent on quarter in the three months to June of 2016, better than a second estimate of 1.1 percent. It is the strongest growth rate in three quarters. Consumer spending continued to boost growth although it expanded less than expected while exports rose at a faster pace and business investment posted the first gain in three quarters.

Personal consumption expenditure (PCE) contributed 2.88 percentage points to growth (2.94 percent in the second estimate) and rose 4.3 percent (4.4 percent in the second estimate). Spending on both durable goods (9.8 percent compared to 9.9 percent in the second estimate) and services (3 percent compared to 3.1 percent in the second estimate) rose slightly less than anticipated while non-durable goods growth was unchanged at 5.7 percent. 

Fixed investment subtracted 0.18 percentage points from the growth (-0.42 percent in the advance estimate) and shrank 1.1 percent (-2.5 percent in the second estimate). Nonresidential investment went up 1 percent, better than a 0.9 percent fall in the second estimate while residential investment fell 7.7 percent (unchanged from the second estimate). 

Private inventories subtracted 1.16 percentage points from the growth, compared to a 1.26 percentage points decrease earlier estimated. Businesses lost $9.5 billion worth of inventory, compared to a $12.4 billion loss in the second estimate. It is the first time since 2011 inventories fell.

Meanwhile, exports increased at a faster 1.8 percent (1.2 percent in the second estimate) while imports rose at a slower 0.2 percent, compared to a 0.3 percent gain in the second estimate, thus bringing the impact from trade to a higher 0.18 percent (0.1 percent earlier reported). 

Government spending and investment subtracted 0.3 percentage points from the growth, more than -0.27 percent in the second estimate. It went down 1.7 percent (compared to a 1.5 percent decline earlier estimated).

US GDP Growth Revised Up to 1.4% in Q2


BEA | Joana Taborda | joana.taborda@tradingeconomics.com
9/29/2016 12:55:53 PM