United States: Fourth quarter growth revised upwards on net exports and investment
February 28, 2013
In the fourth quarter, GDP grew at a seasonally adjusted annualized rate (saar) of 0.1% over the previous quarter, according to the second estimate released by the Bureau of Economic Analysis (BEA) on 28 February. The print marked an improvement compared to the first estimate of minus 0.1% issued on 30 January but surprised market analysts on the downside, as they had expected an increase of 0.5%. The reading represents a deterioration compared to the 3.1% expansion tallied in Q3. For the full year 2012, the economy grew 2.2%, which is up from the 1.8% expansion in 2011.
The improved reading primarily reflects an upward revision to exports and fixed investment combined with a downward revision to imports. Exports were revised up to minus 3.9% (advanced estimate: -5.7% quarter-on-quarter saar), while imports were revised down to minus 4.5% (advanced estimate: -3.2% qoq saar). As a result, the net contribution of the external sector to overall growth was revised up to 0.2 percentage points.
On the domestic side of the economy, both private consumption and government spending were revised slightly down to 2.1% (advanced estimate: +2.2% qoq saar) and to minus 6.9% (advanced estimate: -6.6% qoq saar), respectively. On the other hand, gross fixed investment grew a revised 11.2% (advanced estimate: +9.7 qoq saar) amid an upward revision to both residential and non-residential fixed investment.
The Federal Reserve expects economic growth to range between 2.3% and 3.0% in 2013 and to accelerate to between 3.0% and 3.5% in 2014. FocusEconomics Consensus Forecast panellists expect GDP to expand 1.9% in 2013, which is unchanged from last month's forecast. For 2014, the panel expects the economy to expand 2.8%.