Updated: 25-Apr-24 09:37 ET
| Q1 GDP-Adv. |
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| Updated: 25-Apr-24 09:37 ET |
Highlights
- The Advance Q1 GDP report showed economic output increased at a seasonally adjusted annual rate of 1.6% (Briefing.com consensus 2.4%) versus 3.4% in the fourth quarter, as personal consumption expenditure growth (+2.5%) ended up being weaker than expected.
- The GDP Price Deflator, on the other hand, did not soften. It was up 3.1% versus 1.6% in the fourth quarter.
Key Factors
- Personal consumption expenditure growth increased 2.5% versus 3.3% in the fourth quarter, and contributed 1.68 percentage points to growth.
- Gross private domestic investment was up 3.2% versus 0.7% in the fourth quarter, and contributed 0.56 percentage points to growth.
- Exports increased 0.9% versus 5.1% in the fourth quarter. Imports rose 7.2% versus 2.2% in the fourth quarter. Net exports subtracted 0.86 percentage points to growth.
- Government spending increased 1.2% versus 4.6% in the fourth quarter, and contributed 0.21 percentage points to growth.
- Real final sales of domestic product, which excludes the change in private inventories, increased 2.0% versus 3.9% in the fourth quarter.
- The personal savings rate as a percentage of disposable personal income was 3.6% versus 4.0% in the fourth quarter.
- The PCE price index increased 3.4% versus 1.8% in the fourth quarter. The core PCE price index, which excludes food and energy, increased 3.7% versus 2.0% in the fourth quarter.
Big Picture
- The key takeaway from the report is that it conveyed a disappointing combination of weaker growth and higher inflation. Some will be quick to label that "stagflation," but the reality is that the inflation component isn't the number the Fed is looking for to gain confidence that it can cut rates.
| Category | Q1 | Q4 | Q3 | Q2 | Q1 |
| GDP | 1.6% | 3.4% | 4.9% | 2.1% | 2.2% |
| Inventories (change) | $35.4B | $54.9B | $77.8B | $14.9B | $27.2B |
| Final Sales | 2.0% | 3.9% | 3.6% | 2.1% | 4.6% |
| PCE | 2.5% | 3.3% | 3.1% | 0.8% | 3.8% |
| Nonresidential Inv. | 2.9% | 3.7% | 1.4% | 7.4% | 5.7% |
| Structures | -0.1% | 10.9% | 11.2% | 16.1% | 30.3% |
| Equipment | 2.1% | -1.1% | -4.4% | 7.7% | -4.1% |
| Intellectual Property | 5.4% | 4.3% | 1.8% | 2.7% | 3.8% |
| Residential Inv. | 13.9% | 2.8% | 6.7% | -2.2% | -5.3% |
| Net Exports | -$973.2B | -$918.5B | -$930.7B | -$928.2B | -$935.1B |
| Export | 0.9% | 5.1% | 5.4% | -9.3% | 6.8% |
| Imports | 7.2% | 2.2% | 4.2% | -7.6% | 1.3% |
| Government | 1.2% | 4.6% | 5.8% | 3.3% | 4.8% |
| GDP Price Index | 3.1% | 1.6% | 3.6% | 1.7% | 3.9% |
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