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Second quarter GDP revised down to 2%, half the pace of a year ago

Reflects downward changes to residential investment, government spending and exports

Inflation-adjusted GDP increased at an annual rate of 2% in the second quarter, half the pace of 2018's second quarter, according to the second estimate from the Bureau of Economic Analysis. In the first three months of 2019, GDP grew at a 3.1% pace.

Today's second-quarter GDP estimate is based on more complete data than was available for the advance numbers issued last month, when GDP was estimated at 2.1%.

The change primarily reflected downward revisions to exports, state and local government spending, private inventory investment and residential investment, which were partly offset by an upward revision to personal consumption expenditures.

The chart below shows that GDP fell one percentage point from the first quarter and sits nearly two percentage points below the second quarter of 2018.

Real GDP: Q2 second estimate

 (Click to enlarge)

Inflation-adjusted, or real, gross domestic income rose 2.1% in the second quarter, down from an increase of 3.2% in the first quarter. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weighs GDP and GDI, increased 2.1% in the second quarter, falling from 3.2% in the first quarter.

The increase in real GDP in the second quarter reflected positive contributions from state and local government spending, federal government spending and personal consumption expenditures.

These were partly offset by negative contributions from residential fixed investment, nonresidential fixed investment, exports and private inventory investment. However, imports increased in percentage.

Current-dollar GDP increased 4.6%, or $240.3 billion, in the second quarter to a level of $21.34 trillion. This is up from the first quarter’s 3.9%, or $201.0 billion.

The gross domestic price purchase index increased 2.2% in the second quarter, up from an increase of 0.8% in the first quarter. Lastly, personal consumption expenditures increased 2.3%, up from 0.4% last quarter.

Here are updates to the previous estimate:

Real GDP: Decreased to 2%, down from last estimate’s 2.1%

Current-dollar GDP:  Remained the same from last estimate’s 4.6%

Real GDI: 2.1%

Average of Real GDP and Real GDI: 2.1%

Gross domestic purchases price index:  Remained the same from last estimate’s 2.2%

Personal consumption expenditures: Remained the same from last estimate’s 2.3%

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