Economy
What the Preliminary GDP Reading Means for the Holidays
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The increase in real GDP in the third quarter reflected positive contributions from personal consumption expenditures, nonresidential fixed investment, federal government spending, exports, residential fixed investment, and state and local government spending. In the third quarter, imports decreased, positively contributing to GDP.
The report gives further detail:
The deceleration in the percent change in real GDP reflected a downturn in private inventory investment and decelerations in exports, in nonresidential fixed investment, in state and local government spending, in personal consumption expenditures, and in residential fixed investment that were partly offset by a downturn in imports and an upturn in federal government spending.
The segments for GDP in the third quarter compared to the second quarter:
- Real personal consumption expenditures increased 2.2% compared to 2.5%
- Durable goods increased 8.7% compared to 14.1%
- Nonduraable goods increased 2.2% compared to 2.2%
- Services increased 1.2% compared to 0.9%
- Real exports of goods and services increased 4.9% compared to 11.9%
- Real imports of goods and services decreased by 0.7% compared to an increase of 11.3%
The GDP price index, which measures the prices paid by U.S. residents, had its preliminary reading come in at 1.4% against a Bloomberg consensus estimate of 1.3%. The previous reading was 1.3% as well. Excluding food and energy prices, the price index for gross domestic purchases increased 1.6% in the third quarter compared to 1.7% in the previous quarter.
Real final sales of domestic product increased by 4.1% in the third quarter compared to 3.2% in the second quarter.
Real gross domestic purchases increased 3.0% in the third quarter versus the 4.8% increase in the previous quarter.
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