In its second look at the economy last quarter, the Commerce Department didn't find much that was materially different versus last month's picture.Real GDP grew 1.8% (SAAR), still the weakest growth since Q2'10. The Q1 figure fell short of Consensus expectations for 2.2% growth.

Reported for the first time were corporate profits which rose 1.3% (8.5% y/y). Profits from abroad led the gain with a 12.5% increase (8.1% y/y). Nonfinancial sector earnings rose 5.2% (10.0% y/y) but earnings in the financial sector fell 16.6% (+5.4% y/y).

Weakness in last quarter's GDP components was widespread. Moreover, the weakened growth in personal consumption of 2.2% versus Q4 was a downward revision. Offsetting this was an improved, though still modest, gain in business fixed investment of 3.4%. Lessened was the decline in residential investment, now put at -3.3%. Finally, the decline in government spending was unrevised and down at a 5.1% rate, the most for any quarter since 1983. Lower defense purchases caused federal spending to fall at a deepened 11.7% rate while budget shortfalls pulled state & local spending down at a 3.2% rate, the most in a year.

Deterioration in the foreign trade deficit subtracted an unrevised 0.1 percentage points from last quarter's GDP gain, though export growth of 9.2% (8.4% y/y) was revised up and exceeded the increased 7.6% rise (10.0% y/y) in imports. Quicker inventory accumulation added an increased 1.2 percentage points to GDP growth.

Price inflation as measured by the chained GDP price index quickened to an unrevised 1.9% rate, nearly double last year's gain. The price index for domestic final demand jumped 3.7% (1.6% y/y) and the price index for final sales rose 1.9% (1.5% y/y). The GDP figures are available in Haver's USECON and USNA databases and the expectations number is in AS1REPNA.