U.S. GDP Growth Is Unrevised in Q2'22, Posting Second Straight Quarterly Decline
by:Tom Moeller
|in:Economy in Brief
Summary
- Consumer spending revised slightly higher.
- Business spending revised lower.
- Corporate profits increased modestly.
- Price index raised.
Real GDP growth during Q2'22 was unrevised at -0.6% (+1.8% y/y) after declining an unrevised 1.6% in Q1. The latest figure matched expectations in the Action Economics Forecast Survey. GDP increased at a 2.1% annual rate from 2016 to 2021, up 0.2 percentage points from the earlier estimate.
The Q2 gain in corporate profits after-tax was revised up to 7.4% (7.7% y/y) from 6.1%. Domestic nonfinancial profits rose 7.9% (9.8% y/y). Financial sector earnings declined 9.0% (-10.2% y/y) while foreign sector profits rose 5.8% (21.8% y/y).
Real personal consumption expenditure growth last quarter was revised up to 2.0% (2.4% y/y) from 1.5%. Durable goods outlays fell 2.8% (-3.7% y/y) while nondurable spending declined 2.4% (-1.1% y/y). Services outlays rose 4.6% (4.8% y/y). Business fixed investment growth was revised lower to 0.1% (2.4% y/y). Residential investment declined 17.8% (-7.2% y/y), revised from -16.2%.
Government spending fell 1.6% (-1.3% y/y) last quarter, revised from -1.8%. Federal government spending declined 3.4% (-4.0% y/y), revised from -1.9%. Defense spending rose 1.5% (-3.9% y/y). State & local government spending weakened 0.6% (+0.5% y/y).
The contribution of inventory investment was revised minimally to a 1.9 percentage point subtraction from GDP growth. The narrowing of the foreign trade deficit added 1.2 percentage points to GDP growth, revised from 1.4 percentage points. Exports grew 13.8% (7.3% y/y) while imports rose 2.3% (11.2% y/y).
The GDP price index was revised higher to 9.0% (7.6% y/y) from 8.9%. This remained the fastest pace of GDP price inflation since Q1'81. The Action Economics Forecast Survey expected no revision. The rise in the PCE price Index was revised to 7.3% (6.6% y/y) from 7.1%. The PCE price index less food & energy increased 4.7% (5.0% y/y), revised from 4.4%, and has risen at about that rate for roughly a year. The nonresidential price index rose 8.5% (6.9% y/y), the largest quarterly increase since Q2'81. The residential investment price index rose 15.2%, both q/q and y/y, revised from a 15.3% gain. The government spending price index rose 11.6% (8.3% y/y), revised from 12.4%.
The GDP figures can be found in Haver's USECON and USNA databases. 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.
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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