United States: First quarter GDP growth confirmed
May 26, 2011
In the first quarter, GDP grew 1.8% over the previous quarter at a seasonally adjusted annualised rate (saar), according to figures released by the Bureau of Economic Analysis on 26 May. The print was unchanged over the advance estimate from the month before and undershot market expectations that had growth revised up to 2.1%. Moreover, the print represented a deceleration from the fourth quarter's 3.1% expansion. On an annual basis, GDP slowed from a 2.8% expansion in the previous quarter to a 2.3% increase. Personal consumption expenditures were revised down to a 2.2% expansion (advance estimate: +2.7% quarter-on-quarter saar), which was offset by fixed investment expanding at a faster pace of 2.1% (advance estimate: +0.7% qoq saar). In the external sector, both exports and imports were revised up. While exports expanded 9.2% (advance estimate: +4.9% qoq saar), imports grew 7.5% (advance estimate: +4.4% qoq saar). As a result, the net contribution from the external sector to overall growth was virtually unchanged at minus 0.06 percentage points (advance estimate: -0.08 percentage points). The Federal Reserve projects GDP growth to accelerate from 2.9% in 2010 to between 3.1% and 3.3% this year. In 2012, monetary authorities see the economy expanding at a stronger pace of between 3.5% and 4.2%.