(02-28-19)
Real gross domestic product (GDP) increased at an annual rate of 2.6 percent in the fourth quarter of 2018 (table 1), according to the “initial” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 3.4 percent. Due to the recent partial government shutdown, this initial report for the fourth quarter and annual GDP for 2018 replaces the release of the “advance” estimate originally scheduled for January 30th and the “second” estimate originally scheduled for February 28th. See the Technical Note for details.
The Bureau emphasized that the fourth-quarter initial estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see “Source Data for the Initial Estimate” on page 3). Updated estimates for the fourth quarter, based on more complete data, will be released on March 28, 2019. The increase in real GDP in the fourth quarter reflected positive contributions from personal consumption expenditures (PCE), nonresidential fixed investment, exports, private inventory investment, and federal government spending. Those were partly offset by negative contributions from residential fixed investment, and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased. The deceleration in real GDP growth in the fourth quarter reflected decelerations in private inventory investment, PCE, and federal government spending and a downturn in state and local government spending. These movements were partly offset by an upturn in exports and an acceleration in nonresidential fixed investment. Imports increased less in the fourth quarter than in the third quarter. Current dollar GDP increased 4.6 percent, or $233.2 billion, in the fourth quarter to a level of $20.89 trillion. In the third quarter, current-dollar GDP increased 4.9 percent, or $246.3 billion. The price index for gross domestic purchases increased 1.6 percent in the fourth quarter, compared with an increase of 1.8 percent in the third quarter (table 4). The PCE price index increased 1.5 percent, compared with an increase of 1.6 percent. Excluding food and energy prices, the PCE price index increased 1.7 percent, compared with an increase of 1.6 percent.