Newsroom
September 26, 2014
U.S. economy grows a strong 4.6% in 2Q
The U.S. economy grew 4.6 percent in the second quarter, the strongest quarterly growth since 2011, said NAFCU Chief Economist and Director of Research Curt Long.
The data – the third and final estimate for the second quarter – was released Friday by the Bureau of Economic Analysis. "This final estimate for second-quarter gross domestic product is up from the previous estimate of 4.2 percent and reflects stronger growth in business investment than previously estimated," said Long, who details the data in a NAFCU Macro Data Flash report. "This is the strongest quarter for GDP since 2011, but part of that is surely a rebound from the dismal first quarter."
According to the data, residential investment increased 8.8 percent, nonresidential investment increased 9.7 percent, consumer spending increased 2.5 percent and government spending increased by 1.7 percent.
Contributions to growth of real GDP came from gains in personal consumption expenditures (1.8 percentage points), private inventories (1.4 percentage points), nonresidential investment (1.2 percentage points), government spending (0.3 percentage points), and residential investment (0.3 percentage points). Negative contributions to GDP included net exports (-0.3 percentage points).
Core personal consumption expenditures inflation – excluding food and energy (the Fed's key inflation metric) – increased from 1.2 percent in the first quarter to 2 percent in the second quarter. The year-over-year figure now stands at 1.5 percent and has been moving closer to the Fed's 2 percent target.
"The rebound in GDP can be attributed to strong contributions in inventory accumulation, personal consumption and business investment," Long said. "Overall and core PCE inflation both moved closer to the Fed's target inflation rate in the second quarter."
The data – the third and final estimate for the second quarter – was released Friday by the Bureau of Economic Analysis. "This final estimate for second-quarter gross domestic product is up from the previous estimate of 4.2 percent and reflects stronger growth in business investment than previously estimated," said Long, who details the data in a NAFCU Macro Data Flash report. "This is the strongest quarter for GDP since 2011, but part of that is surely a rebound from the dismal first quarter."
According to the data, residential investment increased 8.8 percent, nonresidential investment increased 9.7 percent, consumer spending increased 2.5 percent and government spending increased by 1.7 percent.
Contributions to growth of real GDP came from gains in personal consumption expenditures (1.8 percentage points), private inventories (1.4 percentage points), nonresidential investment (1.2 percentage points), government spending (0.3 percentage points), and residential investment (0.3 percentage points). Negative contributions to GDP included net exports (-0.3 percentage points).
Core personal consumption expenditures inflation – excluding food and energy (the Fed's key inflation metric) – increased from 1.2 percent in the first quarter to 2 percent in the second quarter. The year-over-year figure now stands at 1.5 percent and has been moving closer to the Fed's 2 percent target.
"The rebound in GDP can be attributed to strong contributions in inventory accumulation, personal consumption and business investment," Long said. "Overall and core PCE inflation both moved closer to the Fed's target inflation rate in the second quarter."
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