WASHINGTON — First quarter GDP growth was revised down slightly to a 2.2% annual rate from the 2.3% pace in the advance estimate, compared with expectations for no revision, data released Wednesday by the Bureau of Economic Analysis showed.
A large downward revision to inventories growth was the key factor, supplemented by small downward revisions to PCE, residential fixed investment, and government spending and a wider trade gap. Providing some offset was a large upward revision to nonresidential fixed investment.
Overall, the data suggest very little change in the overall growth picture, but the mix of revisions resulted in an upward adjustment to final sales. Likewise, the price picture was a little softer than the advance estimate, but not materially.
Inventory investment was revised down to a $20.2 billion gain for the quarter from $33.1 billion in the advance estimate. The net export gap now stands at $650.9 billion, slightly larger than $645.9 billion gap in the advance estimate.
Within consumption, which was revised down slightly to a 1.0% pace for the quarter from the 1.1% advance estimate, there was an upward revision to goods PCE, offset by a downward adjustment to services PCE.
The personal savings rate was unrevised at a 3.1% level and was still up from 2.6% in the previous quarter.
Residential fixed investment was revised down to 2.0% rate of decline from a flat reading in the advance estimate.
Government spending was revised down to a 1.1% gain, compared with a 1.2% rise in the advance estimate.
Providing some offset, nonresidential fixed investment was revised up to a 9.2% pace from the 6.1% gain in the advance estimate, with structures, equipment, and intellectual equipment all revised higher.
As a result of the mix of revisions, real final sales of domestic product were revised up to a 2.0% gain from the 1.9% increase in the advance estimate. Real final sales to domestic purchasers was revised up to a 1.9% pace from 1.6% rise in the advance estimate.
The key price measures were revised generally lower in the second estimate for the quarter. The chain price index was revised down slightly to a 1.9% gain from the previously reported 2.0% rise, well below the 2.3% gain in the fourth quarter.
The closely watched core PCE price index was revised down to a 2.3% gain from 2.5% in the advance estimate, pulling the year/year rate for the measure down to 1.6% from 1.7% in the advance estimate, still slightly ahead of the 1.5% rise in the fourth quarter.
