(03-25-21) Real gross domestic product (GDP) increased at an annual rate of 4.3 percent in the fourth quarter of 2020 (table 1), according to the “third” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 33.4 percent. The “third” estimate of GDP 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 4.1 percent. The upward revision primarily reflected an upward revision to private inventory investment that was partly offset by a downward revision to nonresidential fixed investment. The increase in real GDP reflected increases in exports, nonresidential fixed investment, personal consumption expenditures (PCE), residential fixed investment, and private inventory investment, that were partly offset by decreases in state and local government spending as well as federal government spending (reflecting fewer fees paid to administer the Paycheck Protection Program loans). Imports, which are a subtraction in the calculation of GDP, increased. The increase in exports primarily reflected an increase in goods (led by industrial supplies and materials). The increase in nonresidential fixed investment primarily reflected an increase in equipment (led by transportation equipment). The increase in PCE reflected an increase in services (led by health care). The increase in residential fixed investment primarily reflected an increase in single family units. The increase in private inventory investment primarily reflected an increase in manufacturing, including both durable and nondurable goods industries. Current‑dollar GDP increased 6.3 percent at an annual rate, or $324.4 billion, in the fourth quarter to a level of $21.49 trillion. In the third quarter, GDP increased 38.3 percent, or $1.65 trillion (tables 1 and 3). More information on the source data that underlie the estimates is available in the “Key Source Data and Assumptions” file on BEA’s website. The price index for gross domestic purchases increased 1.7 percent in the fourth quarter, compared with an increase of 3.3 percent in the third quarter (table 4). The PCE price index increased 1.5 percent, compared with an increase of 3.7 percent. Excluding food and energy prices, the PCE price index increased 1.3 percent, compared with an increase of 3.4 percent. Gross Domestic Income and Corporate Profits – Real gross domestic income (GDI) increased 15.7 percent in the fourth quarter, compared with an increase of 24.1 percent in the third quarter. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 9.9 percent in the fourth quarter, compared with an increase of 28.7 percent in the third quarter. Profits from current production (corporate profits with inventory valuation and capital consumption adjustments) decreased $31.4 billion in the fourth quarter, in contrast to an increase of $499.6 billion in the third quarter. Profits of domestic financial corporations increased $17.5 billion in the fourth quarter, compared with an increase of $12.1 billion in the third quarter. Profits of domestic nonfinancial corporations decreased $48.2 billion, in contrast to an increase of $436.2 billion. Rest-of-the-world profits decreased $0.7 billion, in contrast to an increase of $51.3 billion. In the fourth quarter, receipts increased $29.0 billion, and payments increased $29.7 billion.
Gross Domestic Product – 1st quarter (Second Estimate) (03-25-21)
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