Real GDP grew for the first quarter of 2018 at an annual rate of 2% based on the third estimate by the Bureau of Economic Analysis. The fourth quarter of 2017 yielded an increase of 2.9%
Established on more complete data, the general picture of economic growth remains the same. According to the Bureau, “Private inventory investment and personal consumption expenditure (PCE) were revised down.”
The increase in real GDP for the first quarter showcased positive contributions from nonresidential fixed investment, PCE, exports, federal government spending, and state and local government spending that were partly offset by negative contributions from residential fixed investment and private inventory investment. Imports, which are a subtraction in the calculation of GDP, increased.
The Bureau of Economic Analysis noted, “the deceleration in real GDP growth in the first quarter reflected decelerations in PCE, exports, state and local government spending, and federal government spending and a downturn in residential fixed investment. These movements were partly offset by a smaller decrease in private inventory investment and a larger increase in nonresidential fixed investment. Imports, which are a subtraction in the calculation of GDP, decelerated.”
A 2.7% increase was observed for the price index for gross domestic purchases, compared with an increase of 2.5% in the fourth quarter. The PCE price index climbed 2.5%, relative to an increase of 2.7%. Excluding food and energy prices, the PCE price index increased 2.3 percent, compared with an increase of 1.9 percent.
Real gross domestic income (GDI) posted an upward movement of 3.6% in the first quarter, versus an increase of 1% in the fourth quarter. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 2.8% in the first quarter, compared with an increase of 2% in the fourth quarter.
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