Updated: 26-May-17 09:33 ET
| Q1 GDP-Adv. |
 |
|
| Updated: 26-May-17 09:33 ET |
Highlights
- The second estimate for first quarter GDP revealed a seasonally adjusted annual growth rate of 1.2% (Briefing.com consensus +0.8%) versus the advance estimate of 0.7%. The GDP Deflator was revised down to 2.2% (Briefing.com consensus 2.3%) from 2.3%.
- The upward revision was attributed to increases in nonresidential fixed investment and personal consumption expenditures being larger than previously estimated and the decrease in state and local government spending being smaller than previously estimated.
Key Factors
- Real final sales, which exclude the change in inventories, increased 2.2% versus 1.6% with the advance estimate. That is slightly below the prior 10-quarter average of 2.3%.
- Personal consumption expenditures increased 0.6% versus 0.3% with the advance estimate, adding 0.44 percentage points to GDP growth compared to 0.23 percentage points with the advance estimate
- Nonresidential fixed investment was up 11.4% versus 9.4% with the advance estimate, adding 1.34 percentage points to GDP growth compared to 1.12 percentage points with the advance estimate
- State and local government spending decreased 0.6% versus a 1.6% decline with the advance estimate, subtracting 0.06 percentage points from GDP growth compared to 0.17 percentage points with the advance estimate
Big Picture
- The key takeaway from the report is that the revision moved in the right direction, which will aid in tempering concerns about the slowdown when pitted against some otherwise rosy forecasts for the second quarter (Atlanta Fed GDPNow model at 4.1%) that should produce a more encouraging average for the first half of 2017.
| Category | Q1 | Q4 | Q3 | Q2 | Q1 |
| GDP | 1.2% | 2.1% | 3.5% | 1.4% | 0.8% |
| Inventories (change) | -$45.3B | $49.6B | $7.1B | -$9.5B | $40.7B |
| Final Sales | 2.2% | 1.1% | 3.0% | 2.6% | 1.3% |
| PCE | 0.6% | 3.5% | 3.0% | 4.3% | 1.6% |
| Nonresidential Inv. | 11.4% | 0.9% | 1.4% | 1.0% | -3.4% |
| Structures | 28.3% | -1.9% | 12.0% | -2.1% | 0.1% |
| Equipment | 7.2% | 2.0% | -4.5% | -3.0% | -9.5% |
| Intellectual Property | 6.7% | 1.3% | 3.2% | 9.0% | 3.8% |
| Residential Inv. | 13.7% | 9.6% | -4.1% | -7.8% | 7.8% |
| Net Exports | -$599.9B | -$605.0B | -$522.2B | -$558.5B | -$566.3B |
| Export | 5.9% | -4.5% | 10.0% | 1.8% | -0.7% |
| Imports | 3.8% | 8.9% | 2.2% | 0.2% | -0.6% |
| Government | -1.1% | 0.2% | 0.8% | -1.7% | 1.6% |
| GDP Price Index | 2.2% | 2.1% | 1.4% | 2.3% | 0.5% |
|
|