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U.S. First-Quarter Advance GDP Technical Note (Text)

April 27, 2012

Following is the text of the Gross Domestic Product from the Commerce Department.

This technical note provides background information about the source data and estimating methods used to produce the estimates presented in the GDP news release. The complete set of estimates for the first quarter is available on BEA’s Web site at www.bea.gov; a brief summary of “highlights” is also posted on the Web site. In a few weeks, the estimates will be published in BEA’s monthly journal, the Survey of Current Business, along with a more detailed analysis of the estimates (“GDP and the Economy”).

Real GDP

Real GDP increased 2.2 percent (annual rate) in the first quarter of 2012, following an increase of 3.0 percent in the fourth quarter. The deceleration in real GDP in the first quarter reflected a deceleration in inventory investment and a downturn in nonresidential fixed investment that were partly offset by accelerations in consumer spending and in exports.

Source Data for the Advance Estimate

The advance GDP estimate for the first quarter of 2012 is based on source data that are incomplete and subject to revision. Three months of source data were available for consumer spending on goods; shipments of capital equipment, including aircraft; motor vehicle sales and inventories; manufacturing durables inventories; federal government outlays; and consumer, producer, and international prices. Only two months of data were available from most other key data sources; BEA’s assumptions for the third month are shown in table A. Among those assumptions are the following:

* an increase in nondurable manufacturing inventories, * an increase in non-motor-vehicle merchant wholesale and retail

inventories, * an increase in exports of goods, excluding gold, and * an increase in imports of goods, excluding gold.

Prices

The price index for gross domestic purchases--the prices paid by U.S. residents for goods and services wherever produced- -increased 2.4 percent in the first quarter after increasing 1.1 percent in the fourth. Excluding food and energy prices, the price index for gross domestic purchases increased 2.2 percent after increasing 1.2 percent.

Disposable Personal Income and Personal Saving

Real disposable personal income (DPI) increased 0.4 percent in the first quarter, following an increase of 1.7 percent in the fourth. Current-dollar DPI increased 2.8 percent, following an increase of 2.9 percent. The personal saving rate was 3.9 percent in the first quarter, compared with 4.5 percent in the fourth.

Table A. KEY ASSUMPTIONS FOR THE ADVANCE ESTIMATE OF GDP FOR THE FIRST QUARTER OF 2012

For many of the key series used to prepare the advance estimate of GDP, including retail sales, unit automobile and truck sales and inventories, manufacturers’ shipments of nondefense capital goods, manufacturers’ inventories of durable goods, federal defense spending, and consumer, producer, and international price indexes, actual data are available for all months of the quarter.

For the key series shown in this table, actual data for the third month of the quarter usually are not available in time for inclusion in the advance GDP estimate. BEA makes assumptions for the source data that are not yet available; assumptions for March 2012 are shown in the last column of the table. For most series shown, the data for February are preliminary and subject to further revision. Occasionally, the data for earlier months are also subject to revision.

All series shown in the table are in billions of dollars, seasonally adjusted at annual rates, and are published by the Bureau of the Census.

2011 2012

Oct. Nov. Dec. Jan. Feb. Mar.*

Private fixed investment:

Nonresidential structures: 1 Value of new nonresidential

construction put in place............... 280.8 283.6 292.0 285.3 280.8 283.1

Residential structures:

Value of new residential

construction put in place: 2 Single family............................. 107.4 108.8 110.8 113.2 111.5 116.3

3 Multifamily............................... 15.2 16.3 16.4 16.9 17.2 17.9

Change in private inventories: NOTE: Historical (October-January) data may reflect concurrent seasonal factors.

4 Change in inventories for nondurable

manufacturing............................. 50.4 11.5 -4.8 19.7 10.5 20.9

4a Change in inventories for merchant

wholesale and retail industries other

than motor vehicles and equipment......... 75.1 27.3 60.9 41.7 63.5 66.6

Net exports:

Exports of goods: 5 U.S. exports of goods,

international-transactions-

accounts basis.......................... 1533.8 1510.0 1520.7 1542.5 1535.8 1557.6

5a Excluding gold............................. 1489.4 1478.4 1487.4 1499.6 1495.5 1515.4

Imports of goods: 6 U.S. imports of goods,

international-transactions-

accounts basis.......................... 2235.5 2264.1 2301.1 2350.5 2272.5 2363.3

6a Excluding gold............................ 2219.1 2247.4 2284.2 2334.3 2256.3 2346.3

7 Net exports of goods.......................... -701.6 -754.0 -780.5 -808.1 -736.7 -805.6

7a Excluding gold............................ -729.6 -769.0 -796.8 -834.7 -760.9 -830.9

Government:

State and local:

Structures: 8 Value of new construction put

in place.............................. 254.5 257.9 257.8 259.2 253.9 256.5 ____________ *Assumption.

SOURCE: U.S. Commerce Department, http://www.bea.gov.

To contact the reporter on this story: Chris Middleton in Washington at cmiddleton2@bloomberg.net

To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net


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