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Q2 GDP Second Estimate at 3.7%, Better than Forecasts

August 27, 2015

by Jill Mislinski

The Second Estimate for Q2 GDP, to one decimal, came in at 3.7 percent, anincrease from the 2.3 percent Advance Estimate. Today's number was slightly better than most mainstream estimates with Investing.com at 3.2 and Briefing.com at 3.1.

Here is an excerpt from the Bureau of Economic Analysis news release:

Real gross domestic product -- the value of the goods and services produced by the nation's economy less the value of the goods and services used up in production, adjusted for price changes -- increased at an annual rate of 3.7 percent in the second quarter of 2015, according to the "second" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 0.6 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the increase in real GDP was 2.3 percent. With the second estimate for the second quarter, nonresidential fixed investment and private inventory investment increased. With the advance estimate, both of these components were estimated to have slightly decreased.

The increase in real GDP in the second quarter reflected positive contributions from personal consumption expenditures (PCE), exports, state and local government spending, nonresidential fixed investment, residential fixed investment, and private inventory investment. Imports, which are a subtraction in the calculation of GDP, increased. [Full Release]

Here is a look at Quarterly GDP since Q2 1947. Prior to 1947, GDP was calculated annually. To be more precise, the chart shows is the annualized percent change from the preceding quarter in Real (inflation-adjusted) Gross Domestic Product. We've also included recessions, which are determined by the National Bureau of Economic Research (NBER). Also illustrated are the 3.25% average (arithmetic mean) and the 10-year moving average, currently at 1.46 percent.

Quarterly GDP since 1947

Note: The headline 3.7% GDP is 3.68% at two decimal places.

Here is a log-scale chart of real GDP with an exponential regression, which helps us understand growth cycles since the 1947 inception of quarterly GDP. The latest number puts us 14.4% below trend, the largest negative spread in the history of this series.

with a Regression

A particularly telling representation of slowing growth in the US economy is the year-over-year rate of change.

Real GDP Year-over-Year

In summary, the Q2 GDP Second Estimate of 3.7 percent was slightly above mainstream estimates and an improvement over the 2.3 percent Advanced Estimate.

Other GDP updates:

Real GDP Per Capita

Visualizing GDP