Keeping you up to date on the latest data releases.
- Real GDP
Real GDP growth was revised down from 1.7 percent to 1.3 percent in the second quarter according to the third estimate from the Bureau of Economic Analysis. It's safe to say that this was a surprise to private forecasters, as the estimate came in 0.2 percentage points below the low end of the range from Bloomberg’s set of forecasters. On a year-over-year basis, real GDP is up 2.1 percent through the second quarter, down 0.2 percentage points (pp) below its previous estimate. The largest contributor to the sharp downward revision in the second quarter was a knockdown in private inventories, which is now calculated to have subtracted 0.4 pp from real GDP growth, compared to just a 0.2 pp takeaway in the previous estimate. Interestingly, the entirety of this downward revision to private inventories came from the farm sector (perhaps we are getting our first glance at the effects of the drought). Downward revisions to real personal consumption expenditures and exports also contributed to the overall knockdown in second-quarter real GDP. Real consumption was revised down from an increase of 1.7 percent to a 1.5 percent gain in the second quarter, subtracting a little over 0.1 pp from output growth. The downward revision to export growth (from 6.0 percent to 5.2 percent) also took off 0.1pp from second-quarter real GDP. Other major categories were essentially unchanged during the revision. Elsewhere, real Gross Domestic Income (GDI)—an alternative measure of national output—was revised down from an increase of 0.6 percent to a 0.2 percent increase in the second quarter, following relative strong gains in the first quarter (up 3.8 percent) and fourth quarter of last year (up 4.5 percent).