Real gross domestic product (GDP), the total output of goods and services in the U.S., increased at an annual rate of 2.5 percent in the second quarter of 2013, the Bureau of Economic Analysis announced Thursday.
This is the third and final GDP revision for Q2 (April-June) and a definite improvement over Q1’s revised increase of 1.1 percent.
Growth in the second quarter primarily reflected “positive contributions from personal consumption expenditures (PCE), exports, nonresidential fixed investment, private inventory investment and residential fixed investment that were partly offset by a negative contribution from federal government spending,” the report reads.
Government spending fell in Q2 by only 1.6 percent, compared to Q1′s decrease of 8.4 percent. Meanwhile, state and local government spending increased by 0.4 percent, compared to Q1′s decrease of 1.3 percent.
Imports, a subtraction in the calculation of GDP, increased by 6.9 percent
“The acceleration in real GDP in the second quarter primarily reflected upturns in exports and in nonresidential fixed investment,” the report states, “a smaller decrease in federal government spending, and an upturn in state and local government spending that were partly offset by an acceleration in imports and decelerations in private inventory investment and in PCE.”
Real personal consumption expenditures held steady at 1.8 percent in the second quarter, compared to the increase of 2.3 percent in the first, the report adds.
Durable goods in Q2’s third revision increased 6.2 percent, up from Q1’s increase of 5.8 percent. Non-durable goods were also revised lower to 1.6, down from 2.7 percent. Services, on the other hand, were revised in the second revision to 1.2, down from Q1’s increase of 1.5 percent.
Here’s Q2’s third GDP revision broken down by its components [courtesy Zero Hedge]:
Real final sales of domestic product, that is, GDP minus change in private inventories, jumped to 2.1 percent in Q2, up from Q1’s increase of 0.2 percent.
Markets are off to a decent start Friday:
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Featured image via the Associated Press.