2nd GDP Estimate More Optimistic

The Bureau of Economic Analysis said its second estimate of first quarter gross domestic product showed growth at an 0.8 percent annual rate, up from its previous estimate (0.5 percent).

In the fourth quarter, real GDP increased by 1.4 percent.

BEA said its estimate was based on more complete source data than were available for the “advance” estimate issued last month, noting a decrease in private inventory investment.

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

BEA said deceleration in real GDP in the first quarter primarily reflected a larger decrease in nonresidential fixed investment, a deceleration in PCE and a downturn in federal government spending, partly offset by an upturn in state and local government spending, and an acceleration in residential fixed investment.