WASHINGTON — The first revision to second quarter U.S. GDP data maintained the narrative of a strong rebound from the weather-induced contraction in Q1, with analysts expecting the number to be revised downward, as the increase in nonresidential fixed investment larger than previously reported.
The second estimate by the Bureau of Economic Analysis showed Q2 GDP at 4.2% growth, up from 4.0% growth in the advance report and better than the 3.9% growth expected in an MNI survey of economists.
The upward revision to the percent change in real GDP mainly reflected an upward revision to nonresidential fixed investment, to an 8.4% increase from a 5.5% gain in the advance report, and a downward revision to imports (now up 11.0% vs. a 11.7% increase previous) that were partly offset by a downward revision to private inventory investment — now said to have increased by $83.9 billion vs. the advance estimate of $93.4 billion)
Real final sales were revised up to a 2.8% gain from the 2.3% estimate last month, underscoring the strength in the report. Chain Price Index rose 2.1% vs 2.0% previous.
The expansion in economic activity can be traced to exports (up 10.1%), positive contributions from private inventory investment — although that was lowered to 1.39 percentage points from 1.66 previous.
There was also an acceleration in consumer spending, with PCE estimate unchanged at up 2.5% vs a 1.2% gain in Q1.
And this time, state and local government spending and residential investment were additions to GDP. The 2.9% uptick in state and local government spending was partly offset by 0.9% rise in federal government investment and an increase imports.
The second estimate of Q2 GDP results, did not alter the economic picture of a second half acceleration, although showing generally less consumption and more imports.
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