The downward movement in real GDP for the first quarter reflected negative contributions from personal consumption expenditures (PCE), non-residential fixed investment, exports, and private inventory investment. This movement was partly offset by a positive contribution from residential fixed investment federal government spending, and state and local government spending. Moreover, imports decreased.

Notably, the decline in PCE was due to decreases in services, led by health care, and goods, led by motor vehicles and parts. The decrease in non-residential fixed investment was mainly attributable to a decrease in equipment, led by transportation equipment. Meanwhile, the decrease in exports primarily reflected a decline in services, led by travel.

“Current dollar GDP decreased 3.5%, or $191.2 billion, in the first quarter to a level of $21.54 trillion. In the fourth quarter, GDP increased 3.5%, or $186.6 billion,” according to BEA.

In the first quarter of 2020, the price index for gross domestic purchases went up 1.6% when compared to a similar rising by 1.4% in the fourth quarter of 2019. In addition, the PCE price index increased 1.3% relative to an increase of 1.4%. With the exception of the food and energy prices, the PCE price index climbed 1.8% versus an increase of 1.3%.

Disclaimer:
Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.

Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.