Real gross domestic product, the total output of goods and services in the U.S., increased at an annual rate of 2.4 percent in the fourth quarter of 2013, the Bureau of Economic Analysis announced Friday.
This is the second revision for the fourth quarter and a severe disappointment, considering initial estimates put GDP growth at about 3.2 percent.
“The deceleration in real GDP growth in 2013 primarily reflected a deceleration in nonresidential fixed investment, a larger decrease in federal government spending, and decelerations in [personal consumption expenditures] and in exports that were partly offset by a deceleration in imports and a smaller decrease in state and local government spending,” the report said.
But there was some growth in the fourth quarter, which can be attributed to positive contributions from exports, “nonresidential fixed investment, and private inventory investment.”
Government spending fell in the fourth quarter by 12.8 percent, compared the third quarter’s decline of 1.5 percent. Meanwhile, state and local government spending decreased by 0.5 percent, compared to the 1.7 percent increase in the quarter before that.
Imports, a subtraction in the calculation of GDP, increased by 1.5 percent.
“The second estimate of the fourth-quarter percent change in real GDP is 0.8 percentage point, or $32.7 billion,” the report said.
Real personal consumption expenditures increased by 2.6 percent in the fourth quarter, compared to the increase of 2.0 percent in the third.
Durable goods in the second revision of the fourth quarter increased 2.5 percent, down from an increase of 7.9 percent in the third quarter. Non-durable goods increased by 3.5 percent, up from earlier posting of 2.9 percent. Services increased in the second revision to 2.2 percent, up from earlier estimates of 0.7 percent.
Here's a breakdown of the fourth quarter by its components:
Real final sales of domestic product, that is, GDP minus change in private inventories, increased by 2.3 percent in the fourth quarter, down from the third quarter’s increase of 2.5 percent.
Markets are poised to open mostly lower:
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