4Q GDP Holds Steady at 2.1%

The Bureau of Economic Analysis yesterday reported its second (revised) estimate of real gross domestic product increased at an annual rate of 2.1 percent in the fourth quarter, unchanged from its first (advance) estimate last month.

The second GDP estimate is based on more complete source data than were available for the advance estimate issued last month. In the second estimate, an upward revision to private inventory investment was offset by a downward revision to nonresidential fixed investment. The increase in real GDP in the fourth quarter reflected positive contributions from personal consumption expenditures, federal government spending, exports, residential fixed investment and state and local government spending that were partly offset by negative contributions from private inventory investment and nonresidential fixed investment. Imports, a subtraction in the calculation of GDP, decreased.

BEA said real GDP growth in the fourth quarter was unchanged. A downturn in imports and an acceleration in government spending were offset by a larger decrease in private inventory investment and a slowdown in PCE.

Current dollar GDP increased 3.5 percent, or $184.2 billion, in the fourth quarter to a level of $21.73 trillion. In the third quarter, GDP increased 3.8 percent, or $202.3 billion

For all of 2019, BEA said real GDP increased by 2.3 percent from 2018), compared to an increase of 2.9 percent in 2018. The increase in real GDP in 2019 reflected positive contributions from PCE, nonresidential fixed investment, federal government spending, state and local government spending, and private inventory investment that were partly offset by a negative contribution from residential fixed investment. Imports increased.

The report said deceleration in real GDP in 2019, compared to 2018, primarily reflected decelerations in nonresidential fixed investment and PCE, partly offset by accelerations in both state and local and federal government spending. Imports increased less in 2019 than in 2018.

Current-dollar GDP increased 4.1 percent, or $846.9 billion, in 2019 to a level of $21.43 trillion, compared with an increase of 5.4 percent, or $1,060.8 billion, in 2018.