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Economy in Brief

U.S. GDP Growth Is Revised Up With Final Sales & Int'l Trade
by Tom Moeller  December 20, 2012

Economic growth during Q3'12 was better than reported initially. Real GDP increased at a revised 3.1% (2.6% y/y) annual rate, up from 2.7% estimated last month and 2.0% initially. The gain improved from 1.3% during Q2 and beat Consensus expectations for a 2.8% rise. A quicker increase in domestic final demand and more improvement in the foreign trade deficit accounted for the change.

Growth in domestic final demand was nudged up to 1.9% (2.2% y/y) from last month's estimated 1.7% advance. Growth in consumer spending and government were both raised. The decline in business investment was lessened. Improvement in the foreign trade sector contributed an improved 0.4 percentage points to the Q3 GDP advance. Exports rose a very modest 1.9% (3.2% y/y) and imports slipped 0.6% (+2.5% y/y). A quicker rate of inventory accumulation added a little-changed 0.7 percentage points to growth last quarter. However, farm inventories alone reduced GDP growth by an unrevised 0.4 percentage points due to the drought.

Corporate profits growth was lessened slightly to 2.4% (7.5% y/y). After tax profits rose 4.6% (17.9% y/y). Last quarter's gain owed to a 17.5% (29.5% y/y) jump in financial sector earnings. Foreign sector profits fell 1.9% (-2.4% y/y) and domestic nonfinancial earnings fell 1.3% (+5.1% y/y).

The GDP chain price index rose at an elevated and unrevised 2.7% (1.7% y/y) rate, bolstered by a 6.5% (-1.3% y/y) decline in the import price index. The gain in the domestic final sales price index remained moderate at a 1.5% (1.4% y/y) rate.

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

 

Chained 2005 $,% AR Q3'12
(3rd Est)
Q3'12
(Revised)
Q3'12
(Adv)
Q2'12 Q1'12 Q3'12
Y/Y
2011 2010 2009
Gross Domestic Product 3.1 2.7 2.0 1.3 2.0 2.6 1.8 2.4 -3.1
 Inventory Effect 0.7 0.8 -0.1 -0.5 -0.4 0.6 -0.2 1.5 -0.8
Final Sales 2.4 1.9 2.1 1.7 2.4 2.0 2.0 0.9 -2.3
 Foreign Trade Effect 0.4 0.1 -0.2 0.2 0.2 0.1 0.2 -0.4 1.0
Domestic Final Sales 1.9 1.7 2.3 1.4 2.2 1.9 1.8 1.3 -3.3
Demand Components
Personal Consumption 1.6 1.4 2.0 1.5 2.4 1.9 2.5 1.8 -1.9
Business Fixed Investment -1.8 -2.2 -1.3 3.6 7.5 4.6 8.6 0.7 -18.1
Residential Investment 13.6 14.3 14.4 8.4 20.6 13.6 -1.4 -3.1 -22.4
Government Spending 3.9 3.5 3.7 -0.7 -3.0 -0.5 -3.1 0.6 3.7
Chain-Type Price Index
GDP 2.7 2.7 2.8 1.6 2.0 1.7 2.1 1.3 0.9
Final Sales of Dom Prod 2.8 2.8 2.9 1.5 2.0 1.7 2.1 1.3 0.9
Final Sales to Dom Purchasers 1.5 1.5 1.6 0.7 2.5 1.4 2.5 1.6 -0.2
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