Global| Jun 24 2021U.S. GDP Growth is Unrevised in Q1'21; Corporate Profit Estimate Strengthened
by:Tom Moeller
|in:Economy in Brief
Summary
• Consumer spending, business & residential investment are strengthened. • Foreign trade subtraction is increased. • Corporate profit improvement is raised. Real GDP surged 6.4% (SAAR) during Q1'21 (0.4% y/y), unrevised from last [...]
• Consumer spending, business & residential investment are strengthened.
• Foreign trade subtraction is increased.
• Corporate profit improvement is raised.
Real GDP surged 6.4% (SAAR) during Q1'21 (0.4% y/y), unrevised from last month's estimate, following a 4.3% rise during the Q4'20. The gain matched expectations in the Action Economics Forecast Survey.
Corporate profits after tax w/o IVA & CCA adjustments increased 7.0% last quarter (28.1% y/y), revised from 4.6%. That followed a 1.7% decline in Q4'20. Before tax profits with IVA & CCA rose 2.4% (15.5% y/y), revised from no change. Nonfinancial sector earnings improved 5.3% (27.8% y/y), revised from 0.9%, while foreign sector profits fell a little-changed 2.4% (-10.5% y/y).
International trade deficit deterioration reduced GDP growth by an increased 1.5 percentage points, revised from 1.2 points. Exports fell a lessened 2.1% (-9.2% y/y) while imports rose a strengthened 9.5% (6.0% y/y) following two quarters of even stronger gain.
Domestic final sales growth was revised up to 10.5% (2.2% y/y) from 10.3%. Consumer spending growth was revised to 11.4% (1.8% y/y) from 11.3%, following a 2.3% Q4 rise. Consumer durable goods spending rose 49.2% (27.6% y/y), revised from 48.7%. Spending on nondurable goods rose 15.2% (6.0% y/y), revised from 14.0%. Services spending improved 4.2% (-3.3% y/y), revised from 4.6%.
Business fixed investment strengthened 11.7% (3.1% y/y), revised from 10.8%. It was the third straight quarter of strong growth.
Residential investment surged 13.0% (12.9% y/y), revised from 12.7%, to the highest level since the first quarter of 2007.
Government spending was unrevised at 5.7% (0.6% y/y). It was the strongest increase since Q2 2009.
Inventory decumulation reduced GDP growth by 2.7 percentage points, revised from 2.8 points, following two quarters of accumulation.
GDP price data were strengthened. The chain-weighted GDP price index rose 4.3% (2.0% y/y), revised from 4.1% and was the strongest gain since Q1'07. The PCE price measure advanced 3.7% (1.8% y/y), revised from 3.5%, while the business fixed investment price index rose 0.6% (0.4% y/y), revised from 0.5%. The residential investment price index surged 12.3% (7.2% y/y), revised from 11.4%, while the public sector price index strengthened a lessened 6.1% (2.4% y/y).
The GDP figures can be found in Haver's USECON and USNA database. USNA contains virtually all of the Bureau of Economic Analysis' detail in the national accounts. Both databases include tables of the newly published not seasonally adjusted data. The Action Economics consensus estimates can be found in AS1REPNA.
| Chained 2012 $ (%, AR) | Q1'21 (Third Estimate) | Q1'21 (Second Estimate) | Q1'21 (Advance Estimate) | Q4'20 | Q3'20 | Q1'21 Y/Y | 2020 | 2019 | 2018 |
|---|---|---|---|---|---|---|---|---|---|
| Gross Domestic Product | 6.4 | 6.4 | 6.4 | 4.3 | 33.4 | 0.4 | -3.5 | 2.2 | 3.0 |
| Inventory Effect (% point) | -2.7 | -2.8 | -2.6 | 1.4 | 6.6 | 0.1 | -0.6 | 0.0 | 0.2 |
| Final Sales | 9.2 | 9.4 | 9.2 | 2.9 | 25.9 | 0.3 | -2.9 | 2.2 | 2.8 |
| Foreign Trade Effect (% point) | -1.5 | -1.2 | -0.9 | -1.5 | -3.2 | -1.9 | -0.1 | -0.2 | -0.3 |
| Domestic Final Sales | 10.5 | 10.3 | 9.8 | 4.4 | 29.8 | 2.2 | -2.7 | 2.3 | 3.0 |
| Demand Components | |||||||||
| Personal Consumption Expenditure | 11.4 | 11.3 | 10.7 | 2.3 | 41.0 | 1.8 | -3.9 | 2.4 | 2.7 |
| Nonresidential Fixed Investment | 11.7 | 10.8 | 9.9 | 13.1 | 22.9 | 3.1 | -4.0 | 2.9 | 6.9 |
| Residential Investment | 13.0 | 12.7 | 10.8 | 36.6 | 63.0 | 12.9 | 6.1 | -1.7 | -0.6 |
| Government Spending | 5.7 | 5.7 | 6.3 | -0.8 | -4.8 | 0.6 | 1.1 | 2.3 | 1.8 |
| Chain-Type Price Index | |||||||||
| GDP | 4.3 | 4.1 | 4.1 | 2.0 | 3.5 | 2.0 | 1.2 | 1.8 | 2.4 |
| Personal Consumption Expenditure | 3.7 | 3.5 | 3.5 | 1.5 | 3.7 | 1.8 | 1.2 | 1.5 | 2.1 |
| Less Food & Energy | 2.5 | 2.3 | 2.3 | 1.3 | 3.4 | 1.6 | 1.4 | 1.7 | 2.0 |
| Nonresidential Investment | 0.6 | 0.5 | 0.5 | 0.2 | 0.1 | 0.4 | 0.5 | 1.3 | 0.9 |
| Residential Investment | 12.3 | 11.4 | 11.4 | 6.5 | 9.5 | 7.2 | 3.3 | 2.8 | 5.6 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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