U.S. Economy Grows 2.5% in Q3


U.S. real gross domestic product increased at an annual rate of 2.5 percent in the third quarter of 2011 (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.

The increase in real GDP in the third quarter primarily reflected positive contributions from personal consumption expenditures (PCE), nonresidential fixed investment, exports, and federal government spending that were partly offset by negative contributions from private inventory investment and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased.

Final sales of computers added 0.21 percentage point to the third-quarter change in real GDP after adding 0.07 percentage point to the second-quarter change.  Motor vehicle output added 0.07 percentage point to the third-quarter change in real GDP after subtracting 0.10 percentage point from the second-quarter change.

Real personal consumption expenditures increased 2.4 percent in the third quarter, compared with an increase of 0.7 percent in the second.  Durable goods increased 4.1 percent, in contrast to a decrease of 5.3 percent.  Nondurable goods increased 0.2 percent, the same increase as in the second. Services increased 3.0 percent, compared with an increase of 1.9 percent.

Real nonresidential fixed investment increased 16.3 percent in the third quarter, compared with an increase of 10.3 percent in the second. 

Real exports of goods and services increased 4.0 percent in the third quarter, compared with an increase of 3.6 percent in the second.  Real imports of goods and services increased 1.9 percent, compared with an increase of 1.4 percent.

Real federal government consumption expenditures and gross investment increased 2.0 percent in the third quarter, compared with an increase of 1.9 percent in the second.  National defense increased 4.8 percent, compared with an increase of 7.0 percent.  Nondefense decreased 3.7 percent, compared with a decrease of 7.6 percent.  Real state and local government consumption expenditures and gross investment decreased 1.3 percent, compared with a decrease of 2.8 percent.

The change in real private inventories subtracted 1.08 percentage points from the third-quarter change in real GDP after subtracting 0.28 percentage point from the second-quarter change.  Private businesses increased inventories $5.4 billion in the third quarter, following increases of $39.1 billion in the second quarter and $49.1 billion in the first.


TradingEconomics.com, US Bureau of Economic Analysis
10/27/2011 1:38:02 PM