March 28, 2013

4Q12 GDP (032813): An Annualized +0.4%

Filed under: Economy,Taxes & Government — Tom @ 8:25 am

The initial reading was an annualized -0.1%. The first revision was to +0.1%.

Predictions for today:
- Bloomberg — didn’t have a prediction in its stock futures report..
- Reuters — +0.5%
- Business Insider — +0.5%
- Associated Press — also didn’t predict in its futures report.

The report will be here (full release) at 8:30.

HERE IT IS: This may explain the predictions holdbacks —

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 0.4 percent in the fourth quarter of 2012 (that is, from the third quarter to the fourth quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 3.1 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, real GDP increased 0.1 percent. While nonresidential fixed investment is higher than previously estimated, the revision to GDP has not changed the general picture of the economy (for more information, see “Revisions” on page 3).

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

The deceleration in real GDP in the fourth quarter primarily reflected downturns in private inventory investment, in federal government spending, in exports, and in state and local government spending that were partly offset by an upturn in nonresidential fixed investment, a larger decrease in imports, and an acceleration in PCE.

Motor vehicle output added 0.18 percentage point to the fourth-quarter change in real GDP after subtracting 0.25 percentage point from the third-quarter change. Final sales of computers added 0.10 percentage point to the fourth-quarter change in real GDP after adding 0.11 percentage point to the third-quarter change.

My recall is that everyone was SOOOO sure after the initial report in January that revisions would push GDP to a positive annualized 1.0%. Uh, not exactly.


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