GDP Q4 Third Estimate At 2.6%, Up From The 2.4% Second Estimate

The Third Estimate for Q4 GDP, to one decimal, came in at 2.6 percent, up from 2.4 percent in the Second Estimate. The GDP deflator used to calculate real (inflation-adjusted) GDP remained unchanged at 1.6 percent. Investing.com had forecast 2.7 percent for today’s GDP estimate and the deflator to remain unchanged.

Here is an excerpt from the Bureau of Economic Analysis news release:

Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 2.6 percent in the fourth quarter of 2013 (that is, from the third quarter to the fourth quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 4.1 percent. 

The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued last month. In the second estimate, the increase in real GDP was 2.4 percent. With this third estimate for the fourth quarter, the general picture of economic growth remains largely the same; personal consumption expenditures (PCE) was larger than previously estimated, while private investment in inventories and in intellectual property products were smaller than previously estimated (see “Revisions” on page 3). 

The increase in real GDP in the fourth quarter primarily reflected positive contributions from PCE, exports, and nonresidential fixed investment that were partly offset by negative contributions from federal government spending and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased. 

The deceleration in real GDP growth in the fourth quarter reflected a downturn in private inventory investment, a larger decrease in federal government spending, a downturn in residential fixed investment, and a deceleration in state and local government spending that were partly offset by accelerations in PCE and in exports, a deceleration in imports, and an acceleration in nonresidential fixed investment. [Full Release]