U.S. Second Quarter Third Gross Domestic Product (Text)
Following is the text of the Gross Domestic Product report from the Commerce Department.
GROSS DOMESTIC PRODUCT: SECOND QUARTER 2013 (THIRD ESTIMATE)
CORPORATE PROFITS: SECOND QUARTER 2013 (REVISED ESTIMATE)
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 2.5 percent in the second quarter of 2013 (that is, from the first quarter to the second quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 1.1 percent.
The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued last month. In the second estimate, the increase in real GDP was also 2.5 percent. With the third estimate for the second quarter, the general picture of economic growth remains largely the same.
The increase in real GDP in the second quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, nonresidential fixed investment, private inventory investment, and residential fixed investment that were partly offset by a negative contribution from federal government spending. Imports, which are a subtraction in the calculation of GDP, increased.
The acceleration in real GDP in the second quarter primarily reflected upturns in exports and in nonresidential fixed investment, a smaller decrease in federal government spending, and an upturn in state and local government spending that were partly offset by an acceleration in imports and decelerations in private inventory investment and in PCE.
The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 0.2 percent in the second quarter, 0.1 percentage point less than the second estimate; this index increased 1.2 percent in the first quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 0.8 percent in the second quarter, compared with an increase of 1.4 percent in the first.
Real personal consumption expenditures increased 1.8 percent in the second quarter, compared with an increase of 2.3 percent in the first. Durable goods increased 6.2 percent, compared with an increase of 5.8 percent. Nondurable goods increased 1.6 percent, compared with an increase of 2.7 percent. Services increased 1.2 percent, compared with an increase of 1.5 percent.
Real nonresidential fixed investment increased 4.7 percent in the second quarter, in contrast to a decrease of 4.6 percent in the first. Nonresidential structures increased 17.6 percent, in contrast to a decrease of 25.7 percent. Equipment increased 3.3 percent, compared with an increase of 1.6 percent. Intellectual property products decreased 1.5 percent, in contrast to an increase of 3.7 percent. Real residential fixed investment increased 14.2 percent, compared with an increase of 12.5 percent.
Real exports of goods and services increased 8.0 percent in the second quarter, in contrast to a decrease of 1.3 percent in the first. Real imports of goods and services increased 6.9 percent, compared with an increase of 0.6 percent.
Real federal government consumption expenditures and gross investment decreased 1.6 percent in the second quarter, compared with a decrease of 8.4 percent in the first. National defense decreased 0.6 percent, compared with a decrease of 11.2 percent. Nondefense decreased 3.1 percent, compared with a decrease of 3.6 percent. Real state and local government consumption expenditures and gross investment increased 0.4 percent, in contrast to a decrease of 1.3 percent.
The change in real private inventories added 0.41 percentage point to the second-quarter change in real GDP, after adding 0.93 percentage point to the first-quarter change. Private businesses increased inventories $56.6 billion in the second quarter, following increases of $42.2 billion in the first quarter and $7.3 billion in the fourth.
Real final sales of domestic product -- GDP less change in private inventories -- increased 2.1 percent in the second quarter, compared with an increase of 0.2 percent in the first.
Gross domestic purchases
Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever produced -- increased 2.5 percent in the second quarter, compared with an increase of 1.4 percent in the first.
Gross national product
Real gross national product -- the goods and services produced by the labor and property supplied by U.S. residents -- increased 2.7 percent in the second quarter, compared with an increase of 0.6 percent in the first. GNP includes, and GDP excludes, net receipts of income from the rest of the world, which increased $7.7 billion in the second quarter after decreasing $17.5 billion in the first; in the second quarter, receipts increased $2.7 billion, and payments decreased $5.0 billion.
Current-dollar GDP -- the market value of the nation’s output of goods and services -- increased 3.1 percent, or $125.7 billion, in the second quarter to a level of $16,661.0 billion. In the first quarter, current-dollar GDP increased 2.8 percent, or $115.0 billion.
Gross domestic income
Real gross domestic income (GDI), which measures the output of the economy as the costs incurred and the incomes earned in the production of GDP, increased 2.6 percent in the second quarter, compared with an increase of 2.4 percent in the first. For a given quarter, the estimates of GDP and GDI may differ for a variety of reasons, including the incorporation of largely independent source data. However, over longer time spans, the estimates of GDP and GDI tend to follow similar patterns of change.
The “third” estimate of the second-quarter percent change in real GDP is the same as in the “second” estimate issued last month, primarily reflecting downward revisions to private inventory investment and to exports that were offset by an upward revision to state and local government spending.
Profits from current production (corporate profits with inventory valuation adjustment (IVA) and capital consumption adjustment (CCAdj)) increased $66.8 billion in the second quarter, in contrast to a decrease of $26.6 billion in the first. Taxes on corporate income increased $10.0 billion, in contrast to a decrease of $25.0 billion. Profits after tax with IVA and CCAdj increased $56.9 billion, in contrast to a decrease of $1.7 billion.
Dividends increased $273.5 billion in the second quarter, in contrast to a decrease of $103.8 billion in the first. The large second-quarter increase primarily reflected dividends paid by Fannie Mae to the federal government. Undistributed profits decreased $216.6 billion, in contrast to an increase of $102.1 billion. Net cash flow with IVA -- the internal funds available to corporations for investment --decreased $205.3 billion, in contrast to an increase of $140.7 billion.
Profits from current production reflect the depreciation of fixed assets valued at current cost using consistent depreciation profiles. These profiles are based on used-asset prices and do not depend on the depreciation-accounting practices used for federal income tax returns. The IVA and CCAdj are adjustments that convert inventory withdrawals and depreciation of fixed assets reported on a tax-return, historical-cost basis to the current-cost economic measures used in the national income and product accounts.
Corporate profits by industry
Domestic profits of financial corporations increased $24.5 billion in the second quarter, in contrast to a decrease of $4.1 billion in the first. Domestic profits of nonfinancial corporations increased $37.8 billion, in contrast to a decrease of $3.1 billion. The increase in profits of financial corporations reflected increases in both Federal Reserve banks and in “other” financial industries. The increase in nonfinancial corporations primarily reflected increases in retail trade, in utilities, and in information that were partly offset by a decrease in manufacturing. Within manufacturing, the largest decrease was in petroleum and coal products.
The rest-of-the-world component of profits increased $4.6 billion in the second quarter, in contrast to a decrease of $19.6 billion in the first. This measure is calculated as the difference between receipts from rest of the world and payments to rest of the world.
Gross value added of nonfinancial domestic corporate business
In the second quarter, real gross value added of nonfinancial corporations increased, and profits per unit of real value added increased. The increase in unit profits reflected a decrease in unit nonlabor costs incurred by corporations that was partly offset by a decrease in unit prices; unit labor costs were unchanged.
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Next release ・October 30, 2013, at 8:30 A.M. EDT for: Gross Domestic Product: Third Quarter 2013 (Advance Estimate)
SOURCE: U.S. Commerce Department, http://www.bea.gov.
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