Q3 GDP Second Estimate: Real GDP at 2.3%

The Second Estimate for Q3 GDP, to one decimal, came in at 2.9% (2.93% to two decimal places), an increase from -0.6% (-0.58% to two decimal places) for the Q2 Third Estimate. Investing.com had a consensus of 2.7%.

Here is the slightly abbreviated opening text from the Bureau of Economic Analysis news release:

Real gross domestic product (GDP) increased at an annual rate of 2.9 percent in the third quarter of 2022 (table 1), according to the "second" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP decreased 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 2.6 percent. The second estimate primarily reflected upward revisions to consumer spending and nonresidential fixed investment that were partly offset by a downward revision to private inventory investment. Imports, which are a subtraction in the calculation of GDP, decreased more than previously estimated (refer to "Updates to GDP"). [Full Release]

Here is a look at Quarterly GDP since Q2 1947. Prior to 1947, GDP was an annual calculation. To be more precise, the chart shows is the annualized percentage 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 3.18% average (arithmetic mean) and the 10-year moving average, currently at 2.39%.

Quarterly GDP since 1947

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 15.1% below trend.

with a Regression

A particularly telling representation of slowing growth in the US economy is the year-over-year rate of change. The average rate at the start of recessions is 3.29%. Eleven of twelve recessions over this timeframe have begun at a lower level of current real YoY GDP.

Real GDP Year-over-Year

In summary, the Q3 GDP Second Estimate of 2.9% was better than forecast and a major improvement from Q2 GDP.

Other GDP updates (updated after GDP monthly piece):

Real GDP Per Capita

Visualizing GDP

Read more updates by Jill Mislinski