United States gross domestic product increased 2.1 percent in the fourth quarter of 2016, according to the “third” estimate from the Department of Commerce, up from a previous estimate of 1.9 percent.
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U.S. GDP grew 2.1 percent during fourth quarter 2016, according to the “third” estimate from the Department of Commerce.
United States gross domestic product (GDP) – the broadest measure of a nation’s overall economic health – grew 2.1 percent during fourth quarter 2016, according to the “third” advance estimate from the Department of Commerce, up from preliminary and “second” estimates of 1.9 percent issued in the last two months.
Should the estimate hold, real GDP will have increased 1.6 percent in 2016 compared with a 2.6 percent growth rate the previous year. GDP is a calculation of the value of the goods and services produced by a nation’s economy minus the value of the goods and services used up in production.
U.S. GDP grew at a revised 3.5 percent rate in the third quarter, a 1.4 percent rate in the second quarter, and a 0.8 percent rate in the first quarter of 2016. The 3.5 percent growth rate in Q3 was the strongest since third quarter 2014, beating consensus analyst expectations of a revised 3.3 percent expansion pace.
The Commerce Department’s Bureau of Economic Analysis (BEA) said the deceleration in GDP growth in the fourth quarter reflected decreases in exports, federal government spending and nonresidential fixed investment, as well as an increase in imports, which are a subtraction in the calculation of GDP. Those decreases were partly offset by increases in private inventory investment, personal consumption expenditures, residential fixed investment, and state and local government spending.
Real exports of goods and services fell 4.5 percent in the fourth quarter, according to BEA, compared with a 10 percent jump in the third quarter. Imports, meanwhile, grew 9 percent, compared with a 2.2 percent increase the previous quarter.
In slightly more encouraging news for the U.S. economy, the most recent data from Commerce indicates new orders for durable goods in February 2017 grew 1.7 percent to $235.4 billion following a revised 2.3 percent increase in January.
The January increase came on the heels of two consecutive monthly decreases. Durable goods orders fell 0.8 percent in December 2016 and 4.8 percent in November after growing 4.8 percent in October, 0.4 percent in September and 0.3 percent in August.
Census noted that transportation equipment, also up for the second straight month, drove the increase in durable goods orders, rising 4.3 percent to $80.4 billion for the month. Excluding orders for transportation equipment, total durable goods orders ticked up 0.4 percent in February.
Shipments of manufactured durable goods, now up in three of the last four months, grew 0.3 percent to $239.2 billion in February following a revised 0.1 percent decline in January and a 1.6 percent bump in December.