Preliminary 1Q GDP +4.4%; Chain-Weighted Price Index +2.6%; Implicit Price Deflator +2.6%

WASHINGTON – Real gross domestic product – the broadest measure of the economy’s performance – rose at a 4.4% seasonally adjusted annual rate in the first quarter, according to preliminary figures released by the Commerce Department this morning.The preliminary first quarter figure came after an advance estimated GDP acceleration of 4.2% and a fourth quarter gain of 4.1%.Economists interviewed by IFR BondData America predicted a 4.2% rise in preliminary first quarter GDP.Commerce said in a statement released with the preliminary figures that the major contributors to the increase in real GDP in the first quarter were personal consumption expenditures, exports, equipment and software, government spending, and private inventory investment.The slight acceleration in GDP this quarter compared with the previous quarter was due primarily to a slowdown in imports, an upturn in government spending, and an acceleration in consumption that were largely offset by decelerations in exports and equipment and software, Commerce added.Real personal consumption accelerated 3.9% in the preliminary first quarter estimate, compared to a 3.8% advance estimated increase. The gain was led by nondurable goods, which expanded 6.6%, compared with a 6.4% advance estimated increase.Meanwhile, durable goods consumption decreased by 4.2% in the preliminary figures, compared with a 4.7% deceleration in the advance figures. The decline was the largest percent drop since the second quarter of 2000.Also in the personal consumption category, services expenditures sped up 4.2%, compared with an acceleration of 4.3% in the advance figures.Gross private domestic investment expanded 10.1% in the preliminary first quarter estimate, compared to an increase of 7.2% in the advance figures. The preliminary first quarter figure was led by nonresidential fixed investment, which expanded by 5.8%, compared to a 7.2% increase in the advance figures.The nonresidential fixed investment gain was led by equipment and software, which rose 9.8%, compared to an 11.5% gain in the advance figures.Meanwhile, the nonresidential structures category declined 7.0% in the preliminary first quarter estimate, compared to a 6.5% advance estimated decline. The deceleration was the largest percent change in the category since the third quarter of 2002.Residential fixed investment expanded 3.8% -- its slowest pace since the fourth quarter of 2001 -- compared to a 2.1% advance estimated gain. Total fixed investment, which includes both residential and nonresidential investments, rose at a pace of 5.1%, compared to a 5.4% increase in the advance figures.Real exports of goods and services increased 4.9% in the preliminary estimate, compared to a 3.2% climb in the advance figures. Meanwhile, real imports of goods and services rose 5.9%, compared with a 2.0% advance estimated rise.Total government spending grew at a pace of 2.9%, compared to a 2.0% increase in the advance figures.The 2.9% acceleration was driven by federal spending, which rose by 9.2% in the preliminary first quarter estimate, compared to a 10.1% increase in the advance figures. Within that category, federal defense spending increased 13.2%, compared with a 15.1% leap in the advance figures, and federal nondefense spending accelerated 1.5%, compared to a 0.7% slowdown in the advance figures.Meanwhile, state and local spending decreased 0.7% compared with a 2.6% decline in the advance figures.The chain-type measure of gross domestic product registered a 2.6% increase in the preliminary estimate, compared to a 2.5% gain in the advance figures.Economists polled by IFR BondData America had projected a 2.5% increase in chain-type GDP.The implicit price deflator also rose 2.6%, compared with a 2.5% gain in the advance figures. Both the implicit price deflator and the chain-type index accelerated at their fastest pace since the second quarter of 2001, when each rose at a pace of 3.2%.The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 3.3% in the preliminary estimate, compared with a 3.2% advance estimated increase. Excluding volatile food and energy prices, the price index for gross domestic purchases expanded 2.3% in the preliminary first quarter estimate, compared with an identical increase in the advance figures.