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Economy in Brief

U.S. GDP Growth Is Revised Higher, but Remains Scant
by Tom Moeller  March 28, 2013

Economic growth last quarter just didn't amount to much, revisions confirm. The Commerce Department's second revision of Q4'12 growth indicated an  annualized rise of 0.4% (1.7% y/y) following last month's estimate of a 0.1% uptick. Expectations had been for a revised Q4 gain of 0.5%. For all of last year, the economy grew 2.2%, up slightly from 2011's gain of 1.8%.  

Before tax corporate profits with IVA & CCA grew 2.3% (3.1% y/y). After tax profits without IVA & CCA rose 1.8% (13.3% y/y). Nonfinancial earnings advanced 2.3% (4.3% y/y) but financial sector earnings slipped 0.8% (+2.9% y/y). Earnings from outside the U.S. rose 5.6% (0.3% y/y).

Improvement in the foreign trade deficit added 0.3 percentage points to overall economic growth, about the same as the 0.2 points estimated last month. That occurred as exports fell at a 2.8% rate (+2.1% y/y) and imports dropped at a 4.2% rate (+0.2% y/y). For the year, the foreign trade sector added 0.1 percentage points to GDP's advance, about the same as in 2011. The degree that inventory decumulation subtracted from economic growth also was minimally revised, 1.5 percentage points. For the whole year, inventories added just 0.2 percentage points to economic growth, following a 0.2 point subtraction in 2011.

Revised estimates of growth in domestic final sales were small. The overall gain of 1.5% (1.8% y/y) was led by a downwardly revised 1.8% advance (1.8% y/y) in personal consumption. Real fixed capital spending grew at an improved 13.1% rate (5.5% y/y) while growth in residential investment was minimally changed at 17.5% (14.9% y/y). These gains were offset by a 7.0% decline (-1.8% y/y) in government purchases.

Price inflation crept up at a little-changed 1.0% rate (1.8% y/y). It remained a significant moderation from Q3. For the whole year, the chain-type price index grew 1.8% after a 2.1% rise in 2011. Domestic prices rose at a steady 1.6% clip (1.6% y/y) last quarter and rose 1.7% for the full year. That's down from the 2.5% increase in 2011.

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 Q4'12 (2nd Rev) Q4'12 (1st Rev) Q4'12 (Adv) Q3'12 Q2'12 Q4 Y/Y 2012 2011 2010
Gross Domestic Product 0.4 0.1 -0.1 3.1 1.3 1.7 2.2 1.8 2.4
 Inventory Effect -1.5 -1.6 -1.3 0.7 -0.5 -0.4 0.2 -0.2 1.5
Final Sales 1.9 1.7 1.1 2.4 1.7 2.1 2.1 2.0 0.9
 Foreign Trade Effect 0.3 0.2 -0.3 0.4 0.2 0.3 0.1 0.2 -0.4
Domestic Final Sales 1.5 1.4 1.3 1.9 1.4 1.8 1.9 1.8 1.3
Demand Components
Personal Consumption 1.8 2.1 2.2 1.6 1.5 1.8 1.9 2.5 1.8
Business Fixed Investment 13.1 9.7 8.4 -1.8 3.6 5.5 8.0 8.6 0.7
Residential Investment 17.5 17.4 15.3 13.6 8.4 14.9 12.1 -1.4 -3.1
Government Spending -7.0 -6.9 -6.6 3.9 -0.7 -1.8 -1.7 -3.1 0.6
Chain-Type Price Index
GDP 1.0 0.9 0.6 2.7 1.6 1.8 1.8 2.1 1.3
Final Sales of Domestic Product 1.0 0.9 0.6 2.8 1.5 1.8 1.8 2.1 1.3
Final Sales to Domestic Purchasers 1.6 1.5 1.3 1.5 0.7 1.6 1.7 2.5 1.6
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