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Thursday, September 26, 2013

Second Quarter Growth Remained at 2.5% in Final Estimate

Real GDP growth for the second quarter remained at 2.5% in the BEA’s final estimate. Growth was previously revised up in the second estimate to 2.5% from 1.7% in the first estimate. GDP growth is faster than growth during the second quarter last year, which was 1.2%



Consumption, fix investment and government expenditures increased slightly while inventories and net exports declined from the second estimate.



Consumption continues to be the GDP driver of the recovery, settling at a 1.24% increase. However, fixed investment also showed large gains in the second quarter, growing 0.96%. It means fixed investment will likely have smaller gains in the following quarter.

Inventories finished the quarter at a 0.41% increase, which has yet to offset the loss in fourth quarter of 2012, even with large gains in the first quarter. Net exports declined slightly, but will likely pick up next quarter as Europe starts to see positive GDP growth for its first quarter. The government drag was 0.07% and is expected to increase as sequester stays for the FY 2014.

Read the BEA release.

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