The third and final estimate of third quarter U.S. GDP by the Bureau of Economic Analysis is out.
GDP grew 4.1% at an annualized rate in the third quarter, according to the estimate. Economists predicted growth of 3.6%, in line with the second estimate published by the BEA earlier this month.
Personal consumption growth surged to 2.0% from the previous 1.4% estimate.
The GDP price index came in at 2.0%, as expected, while core PCE was 1.4%, slightly below the previous 1.5% estimate.
A buildup in inventories contributed 1.7% to GDP growth in Q3, unchanged from the previous estimate (private businesses increased inventories $US115.7 billion in the third quarter, following increases of $US56.6 billion in the second quarter and $US42.2 billion in the first.)
“The key takeaway from this report is simply that the underlying momentum in U.S. economic activity has shifted up a gear in Q3,” says Millan Mulraine, deputy head of U.S. research and strategy at TD Securities. “While much of the gain in overall activity was due to inventory accumulation (accounting for 1.7 percentage points), the strengthening in domestic consumption and investment activity points to a more constructive narrative on economic activity that previously thought.”
Below is a summary of the data from the BEA:
Real gross domestic product — the output of goods and services produced by labour and property located in the United States — increased at an annual rate of 4.1 per cent in the third quarter of 2013 (that is, from the second quarter to the third quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 2.5 per cent.
The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued on December 5, 2103. In the second estimate, the increase in real GDP was 3.6 per cent (see “Revisions” on page 3). With this third estimate for the third quarter, increases in personal consumption expenditures (PCE) and in nonresidential fixed investment were larger than previously estimated.
The increase in real GDP in the third quarter primarily reflected positive contributions from private inventory investment, PCE, nonresidential fixed investment, exports, residential fixed investment, and state and local government spending that were partly offset by a negative contribution from federal government spending. Imports, which are a subtraction in the calculation of GDP, increased.
The acceleration in real GDP growth in the third quarter primarily reflected an acceleration in private inventory investment, a deceleration in imports, and accelerations in state and local government spending and in PCE that were partly offset by a deceleration in exports.