An Inside Look at the Q2 2023 GDP Third Estimate

Real gross domestic product (GDP) is comprised of four major subcomponents: personal consumption expenditures, gross private domestic investment, net exports, and government consumption expenditures. In the latest Q2 2023 third estimate update it was reported that real GDP increased at an annual rate of 2.1%. All four components made positive contributions.

Last 4 quarters contributions to GDP Percent Change
  • Gross private domestic investment (GPDI) contributed 0.90 - Revised Up from 2nd Estimate
  • Government consumption expenditures (GCE) contributed 0.57 - Revised Down from 2nd Estimate
  • Personal consumption expenditures (PCE) contributed 0.55 - Revised Down from 2nd Estimate
  • Net exports of goods and services (NEGS) contributed 0.04 - Revised Up from 2nd Estimate

Over time, the personal consumption expenditures (PCE) component has shown the most consistent correlation with real GDP. When PCE has been positive, GDP has usually been positive, and vice versa (although this was not the case in Q1 and Q2 2022).