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Economic Activity — Past and Present

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New estimates of gross domestic product for 1998:IIQ revealed nothing new about the economy. Preliminary real GDP growth was 0.2% higher than in the advance estimate. This reflected slight upward adjustments in a number of components, largely offset by small downward adjustments to imports and inventory investment. It remains the case that GDP growth declined sharply from the 5.5% pace of the first quarter to 1.6% in the second. Two-thirds of this reduction can be attributed to slower inventory accumulation, which increased less than half the first-quarter amount. The rest of the slowing in GDP can be traced to less rapid increases in investment spending for producers’ durable equipment, including information-processing equipment. Forecasters expect some pickup in GDP growth through this year and next, but only at a subdued pace.

Suggested citation: “Economic Activity — Past and Present,” Federal Reserve Bank of Cleveland, Economic Trends, no. 98-09, pp. 09-10, 09.01.1998.

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