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Revisions to the Gdp

In: Business and Management

Submitted By ronloo3
Words 267
Pages 2
Initial reports include data that do not reflect actual monthly changes in the economy, but quarterly reports. Landefeld and Okubu advised that fiscal and monetary policy projections also need this breakdown to be able to understand and project the impact of trends in intangible assets by type on the trend growth in real GDP and prices. The article “BEA Revises Estimate of Annualized U.S. GDP Economic Growth to 1.73%” Economic/US Economy” mentioned that the BEA found in their first revision to their estimate of the second quarter 2012 GDP that the annualized rate of U.S. domestic economic growth was 1.73%, up 0.19% from their initial estimate -- but still down about a quarter of a percent from the 1.97% reported for the prior quarter and down over two and a quarter percent from the 4.10% growth rate for the 4th quarter of 2011. The article pointed out that the upward revisions in the growth rate came primarily from substantial improvements in trade, with plunging imports alone contributing a half percent to the new growth number. The article highlights that the contributions from exports and consumer expenditures on services also grew modestly, and the contraction rate for government expenditures also moderated. The article advised that the biggest revision was in reported changes to inventories. The previously reported growth from inventory building was revised sharply downward to a net draw-down of inventories -- enough to contract the headline number by -0.23% (although this revised number was still up somewhat from the revised -0.39% contraction rate for the prior...

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