United States: Weak first quarter growth figure revised up a notch
June 24, 2011
In the first quarter, GDP expanded a seasonally adjusted annualised rate (saar) of 1.9% over the previous quarter, according to the third estimate released by the Bureau of Economic Analysis on 24 June. The print was revised up a notch from the second estimate reported last month, but still came in below the 3.1% saar expansion tallied in the previous quarter. In annual terms, GDP growth fell from a 2.8% expansion in the fourth quarter to a 2.3% in increase in the first. The modest upward revision was mainly the result of a larger contribution from the external sector to growth. Exports of goods and services expanded 7.6% (previously reported: +4.9% quarter-on-quarter saar) while imports grew 5.1% (previously reported: +4.4% qoq saar). As a result, the net contribution from the external sector to overall growth stepped up to 0.14 percentage points (second estimate: +0.06 percentage points). At the domestic level, personal consumption expenditures were revised down to a 2.2% expansion (second estimate: +2.7% qoq saar), whereas total fixed investment was revised up to a 1.3% increase (second estimate: +0.7% qoq saar), on the back of stronger non-residential fixed investment as well as an upward revision to inventory investment. In its most recent projections from June, the Federal Reserve revised its growth forecast down to between 2.7% and 2.9% for this year (April forecast: +3.1% and +3.3%) and to between 3.3% and 3.7% for 2012 (April forecast: +3.5% and +4.2%).