Real gross domestic product  increased at an annual rate of 1.4 percent in the fourth quarter of 2015, according to the “third” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 2.0 percent.
The deceleration in real GDP in the fourth quarter primarily reflected downturns in nonresidential fixed investment and in state and local government spending, a deceleration in PCE, and a downturn in exports that were partly offset by a smaller decrease in private inventory investment, a downturn in imports, and an acceleration in federal government spending.
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 – the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes – was 1.0 percent. With this third estimate for the fourth quarter, the general picture of economic growth remains largely the same; personal consumption expenditures (PCE) increased more than previously estimated.
The increase in real GDP in the fourth quarter reflected positive contributions from PCE, residential fixed investment, and federal government spending that were partly offset by negative contributions from nonresidential fixed investment, exports, private inventory investment, and state and local government spending. Imports, which are a subtraction in the calculation of GDP, decreased.
Real gross domestic income (GDI), which measures the value of the production of goods and services in the United States as the costs incurred and the incomes earned in production, increased 0.9 percent in the fourth quarter, compared with an increase of 2.0 percent in the third. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 1.1 percent in the fourth quarter, compared with an increase of 2.0 percent in the third.
Real gross domestic purchases – purchases by U.S. residents of goods and services wherever produced – increased 1.5 percent in the fourth quarter, compared with an increase of 2.2 percent in the third.
The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 0.4 percent in the fourth quarter, compared with an increase of 1.3 percent in the third. Excluding food and energy prices, the price index for gross domestic purchases increased 1.0 percent, compared with an increase of 1.3 percent.
Current-dollar GDP – the market value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production – increased 2.3 percent, or $104.6 billion, in the fourth quarter to a level of $18,164.8 billion. In the third quarter, current-dollar GDP increased 3.3 percent, or $146.5 billion.
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