U.S. GDP Grows 4.6 Percent in Q2
Residential fixed investment grows 8.8 percent; nonresidential increases 9.7.
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 4.6 percent in the second quarter of 2014, according to the "third" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 2.1 percent.
This GDP estimate 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 4.2 percent. With the third estimate for the second quarter, the general picture of economic growth remains the same; increases in nonresidential fixed investment and in exports were larger than previously estimated.
The increase in real GDP in the second quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, private inventory investment, nonresidential fixed investment, state and local government spending, and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.
Real GDP increased 4.6 percent in the second quarter, after decreasing 2.1 percent in the first.
This upturn in the percent change in real GDP primarily reflected upturns in exports and in private inventory investment, accelerations in nonresidential fixed investment and in PCE, and upturns in state and local government spending and in residential fixed investment that were partly offset by an acceleration in imports.
The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 2.0 percent in the second quarter, 0.1 percentage point more than in the second estimate; this index increased 1.4 percent in the first quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 1.7 percent, compared with an increase of 1.3 percent.
Real personal consumption expenditures increased 2.5 percent in the second quarter, compared with an increase of 1.2 percent in the first. Durable goods increased 14.1 percent, compared with an increase of 3.2 percent. Nondurable goods increased 2.2 percent; it was unchanged in the first quarter. Services increased 0.9 percent, compared with an increase of 1.3 percent.
Real nonresidential fixed investment increased 9.7 percent in the second quarter, compared with an increase of 1.6 percent in the first. Investment in nonresidential structures increased 12.6 percent, compared with an increase of 2.9 percent. Investment in equipment increased 11.2 percent, in contrast to a decrease of 1.0 percent. Investment in intellectual property products increased 5.5 percent, compared with an increase of 4.6 percent. Real residential fixed investment increased 8.8 percent, in contrast to a decrease of 5.3 percent.
Real exports of goods and services increased 11.1 percent in the second quarter, in contrast to a decrease of 9.2 percent in the first. Real imports of goods and services increased 11.3 percent, compared with an increase of 2.2 percent.
Real federal government consumption expenditures and gross investment decreased 0.9 percent in the second quarter, compared with a decrease of 0.1 percent in the first. National defense increased 0.9 percent, in contrast to a decrease of 4.0 percent. Nondefense decreased 3.8 percent, in contrast to an increase of 6.6 percent. Real state and local government consumption expenditures and gross investment increased 3.4 percent, in contrast to a decrease of 1.3 percent.
The change in real private inventories added 1.42 percentage points to the second-quarter change in real GDP after subtracting 1.16 percentage points from the first-quarter change. Private businesses increased inventories $84.8 billion in the second quarter, following increases of $35.2 billion in the first quarter and $81.8 billion in the fourth.
Real final sales of domestic product -- GDP less change in private inventories -- increased 3.2 percent in the second quarter, in contrast to a decrease of 1.0 percent in the first.
Gross domestic purchases
Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever produced -- increased 4.8 percent in the second quarter, in contrast to a decrease of 0.4 percent in the first.
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