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September 28, 2012
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U.S. GDP growth rate for 2Q revised downward to 1.3%; 1Q was 2.0%

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 1.3 percent in the second quarter of 2012 (that is, from the first quarter to the second quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 2.0 percent.

The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued last month. In the second estimate, the increase in real GDP was 1.7 percent.

The increase in real GDP in the second quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, nonresidential fixed investment, and residential fixed investment 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.

The deceleration in real GDP in the second quarter primarily reflected decelerations in PCE, in nonresidential fixed investment, and in residential fixed investment that were partly offset by smaller decreases in federal government spending and in state and local government spending and an acceleration in exports.

Motor vehicle output added 0.20 percentage point to the second-quarter change in real GDP after adding 0.72 percentage point to the first-quarter change. Final sales of computers subtracted 0.10 percentage point from the second-quarter change in real GDP after adding 0.02 percentage point to the first-quarter change.

The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 0.7 percent in the second quarter, 0.1 percentage point less than the second estimate; this index increased 2.5 percent in the first quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 1.4 percent in the second quarter, compared with an increase of 2.4 percent in the first.

Real personal consumption expenditures increased 1.5 percent in the second quarter, compared with an increase of 2.4 percent in the first. Durable goods decreased 0.2 percent, in contrast to an increase of 11.5 percent. Nondurable goods increased 0.6 percent, compared with an increase of 1.6 percent. Services increased 2.1 percent, compared with an increase of 1.3 percent.

Real nonresidential fixed investment increased 3.6 percent in the second quarter, compared with an increase of 7.5 percent in the first. Nonresidential structures increased 0.6 percent, compared with an increase of 12.9 percent. Equipment and software increased 4.8 percent, compared with an increase of 5.4 percent. Real residential fixed investment increased 8.5 percent, compared with an increase of 20.5 percent.

Real exports of goods and services increased 5.3 percent in the second quarter, compared with an increase of 4.4 percent in the first. Real imports of goods and services increased 2.8 percent, compared with an increase of 3.1 percent.

Real federal government consumption expenditures and gross investment decreased 0.2 percent in the second quarter, compared with a decrease of 4.2 percent in the first. National defense decreased 0.2 percent, compared with a decrease of 7.1 percent. Nondefense decreased 0.4 percent, in contrast to an increase of 1.8 percent. Real state and local government consumption expenditures and gross investment decreased 1.0 percent, compared with a decrease of 2.2 percent.

The change in real private inventories subtracted 0.46 percentage point from the second-quarter change in real GDP, after subtracting 0.39 percentage point from the first-quarter change. Private businesses increased inventories $41.4 billion in the second quarter, following increases of $56.9 billion in the first quarter and $70.5 billion in the fourth.

Real final sales of domestic product — GDP less change in private inventories — increased 1.7 percent in the second quarter, compared with an increase of 2.4 percent in the first.

Gross domestic purchases

Real gross domestic purchases — purchases by U.S. residents of goods and services wherever produced — increased 1.0 percent in the second quarter, compared with an increase of 1.8 percent in the first.

Gross national product

Real gross national product — the goods and services produced by the labor and property supplied by U.S. residents — increased 2.1 percent in the second quarter, compared with an increase of 0.6 percent in the first. GNP includes, and GDP excludes, net receipts of income from the rest of the world, which increased $27.4 billion in the second quarter after decreasing $44.1 billion in the first; in the second quarter, receipts increased $3.5 billion, and payments decreased $24.0 billion.

Current-dollar GDP

Current-dollar GDP — the market value of the nation’s output of goods and services — increased 2.8 percent, or $107.3 billion, in the second quarter to a level of $15,585.6 billion. In the first quarter, current-dollar GDP increased 4.2 percent, or $157.3 billion.

Gross domestic income

Real gross domestic income (GDI), which measures the output of the economy as the costs incurred and the incomes earned in the production of GDP, increased 0.2 percent in the second quarter, compared with an increase of 3.8 percent in the first. For a given quarter, the estimates of GDP and GDI may differ for a variety of reasons, including the incorporation of largely independent source data. However, over longer time spans, the estimates of GDP and GDI tend to follow similar patterns of change.

Revisions

The “third” estimate of the second-quarter percent change in real GDP is 0.4 percentage point, or $16.0 billion, less than the “second” estimate issued last month, primarily reflecting downward revisions to private inventory investment, to personal consumption expenditures, and to exports.

Advance Est.     2nd Estimate    3rd Estimate

(Percent change from preceding quarter)

Real GDP………………………….          1.5                      1.7                       1.3

Current-dollar GDP…………………         3.1                      3.3                      2.8

Gross domestic purchases price index… 0.7                    0.8                      0.7

 

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