Final 1Q GDP Estimate Up Slightly to 1.1% Growth

The Bureau of Economic Analysis yesterday issued its final (third) prognosis on first quarter gross domestic product, upping its estimate slightly to 1.1 percent growth.

In its previous estimate in May, BEA pegged growth at 0.8 percent. In the fourth quarter, real GDP increased by 1.4 percent. BEA said with its third estimate, the general picture of economic growth “remains the same.”

The report said the increase in real GDP in the first quarter reflected positive contributions from personal consumption expenditures, residential fixed investment, state and local government spending and exports, partly offset by negative contributions from nonresidential fixed investment, private inventory investment and federal government spending. Imports, a subtraction in the calculation of GDP, decreased.

BEA attributed deceleration in real GDP to a slowdown in PCE, a larger decrease in nonresidential fixed investment and a downturn in federal government spending partly offset by upturns in state and local government spending and exports and an acceleration in residential fixed investment.

The report said real gross domestic income, which measures the value of production of goods and services in the United States as the costs incurred and the incomes earned in production, increased by 2.9 percent in the first quarter, compared to an increase of 1.9 percent in the fourth. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased by 2.0 percent in the first quarter, compared to an increase of 1.7 percent in the fourth.