Real gross domestic product (GDP) growth fell more than expected in the second quarter of 2010 (Q210), indicating economic expansion is slowing. Real GDP — measured as the output of goods and services produced by US labor and property — grew at an annual rate of 2.4% in Q210, according to “advance” estimates from the US Department of Commerce Bureau of Economic Analysis (BEA). The market consensus had placed slowed growth rate at 2.5%, although some expected a growth rate even lower. The overall growth reflects positive contributions from government spending, residential and nonresidential fixed investment, exports and personal consumption. The deceleration in growth reflects an acceleration in imports — which are subtracted in the calculation of GDP — and a deceleration in private inventory investment, BEA said. The Q210 estimate includes the regular annual revision to the national income and product accounts, which was released this month. The slow-down in Q210 GDP growth comes after the BEA’s second Q110 revision brought GDP growth down to 2.7%, from 3.2% initially projected in April and the later-revised 3% estimated in May, as jobless data weighed on the economic outlook. Although initial jobless claims fell 11,000 in the week ending July 24 — beating the market consensus of a 4,000-claim drop — the economy has a long way to go to recover the millions of jobs lost during the height of the recession. Economist and fellow at the Royal Institute of Chartered Surveyors (RICS) Lawrence Souza told HousingWire a quarterly GDP growth of 5-6% is needed to bring down the national unemployment rate a single percentage point. At that rate, normal levels of employment at 95-96% of the available labor force (4-5% unemployment rate) could be achieved by 2015. Write to Diana Golobay.

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