Real gross domestic product surged in the second quarter to a level not seen since the first quarter of 2015, according to the second estimate from the Bureau of Economic Analysis.
In fact, the chart below shows this increase marks the highest GDP level since the first quarter of 2015.
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Recently, HousingWire examined whether President Donald Trump is on track to meet his campaign promise of 4% GDP. This increase puts the administration one step closer to that goal.
However, one expert explained this increase may not last.
“The American consumer was behind second quarter GDP numbers being revised up from 2.6% to 3%: Spending was revised to 3.3% from 2.8%, and consumers account for two-thirds of GDP,” said Robert Frick, Navy Federal Credit Union corporate economist. “But is it sustainable? Given wage gains are meager, and consumers are saving less and charging more, this may be a temporary surge.”
“Not coincidentally, today the ADP Employment report revised up its job numbers,” Frick said. “Americans are optimistic given the jobs situation, and that may be what's behind increased spending.”
Real gross domestic income increased 2.9% in the second quarter, up from the first quarter’s increase of 2.7%. The average of real GDP and real GDI, a supplemental measure a measure of U.S. economic activity that equally weights GDP and GDI, increased 3% in the second quarter, up from an increase of 2% in the first quarter.
Here are updates to the previous estimate:
Current-dollar GDP: Increased to 4%, up from last estimate’s 3.6%
Gross domestic purchases price index: Held steady at 0.8%
Personal consumption expenditures: Held steady at 0.3%