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Economy in Brief

U.S. GDP Growth Is Unrevised; Profits Are Lowered
by Tom Moeller  June 28, 2012

GDP growth during last quarter was unrevised at 1.9% (SAAR), still its weakest since Q3'11. The figure matched Consensus estimates. Revised lower were corporate profits which fell 0.3% (+5.5% y/y) instead of rising 0.6% as reported last month. Profits in domestic financial industries rose 5.7% (2.4% y/y) while profits from nonfinancial industries increased 1.4% (14.4% y/y). Foreign corporate earnings fell 11.8% (-12.1% y/y).

Inventory building's contribution to growth continued negligible at 0.1 percentage points. Foreign trade's 0.1% contribution also was little different from last month's report. Exports grew at a reduced 4.2% rate (3.8% y/y) as imports rose a lessened 2.7% (2.2% y/y).

On the demand side, an upward revision to business investment growth to 3.1% (8.5% y/y) was accompanied by negligible revisions elsewhere. Growth in PCE was lessened to 2.5% (1.7% y/y) and government spending growth remained at -4.0% (-2.3% y/y). Growth in residential investment was little changed at 20.0% (9.0% y/y) as warm temperatures fueled growth.

Price inflation as measured by the chain-weight price index was unrevised at 2.0% (2.0% y/y).

The latest GDP figures can be found in Haver's USECON and USNA databases; USNA contains basically all of the Bureau of Economic Analysis' detail on the national accounts, including the new integrated economics accounts and the recently added GDP data for U.S. Territories. The Consensus estimates can be found in AS1REPNA.

A Quick Look at Fed Forecasting from the Federal Reserve Bank of Cleveland is available here.

Chained 2005 $,% AR Q1'12 (Third Estimate) Q1'12
(2nd Estimate)
Q1'12
(Advance)
Q4'11 Q3'11 Q1'12
Y/Y
2011 2010 2009
Gross Domestic Product 1.9 1.9 2.2 3.0 1.8 2.0 1.7 3.0 -3.5
 Inventory Effect 0.1 0.2 0.6 1.8 -1.4 0.1 -0.2 1.6 -0.9
Final Sales 1.8 1.7 1.6 1.1 3.2 1.9 1.9 1.4 -2.6
 Foreign Trade Effect 0.1 -0.1 -0.0 -0.3 0.4 0.2 0.1 -0.4 1.0
Domestic Final Sales 1.6 1.7 1.6 1.3 2.7 1.7 1.8 1.8 -3.6
Demand Components
Personal Consumption 2.5 2.7 2.9 2.1 1.7 1.7 2.2 2.0 -1.9
Business Fixed Investment 3.1 1.9 -2.1 5.2 15.7 8.5 8.8 4.4 -17.9
Residential Investment 20.0 19.3 19.0 11.7 1.2 9.0 -1.3 -4.3 -22.2
Government Spending -4.0 -3.9 -3.0 -4.1 -0.1 -2.3 -2.1 0.7 1.7
Chain-Type Price Index
GDP 2.0 1.7 1.5 0.9 2.6 2.0 2.1 1.2 1.1
Final Sales of Domestic Product 2.0 1.7 1.5 0.9 2.6 2.0 2.1 1.2 1.0
Final Sales to Domestic Purchasers 2.6 2.5 2.4 1.1 2.0 2.3 2.5 1.5 -0.1
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