The US economy is growing at a faster rate in the first quarter than previously calculated, according to the second reading of the data. The increase is revised upwards from 0.7% to 1.2% on annual basis and this may somewhat dispel the fear of slow growth in early 2017. The first reading of the data reported the slightest rise in three years and was a sharp slowdown after 2.1% growth in the last quarter of last year. The upside revision is significant and the value is more than 0.9%, as predicted by economists.
The preliminary US GDP data are weak in recent years due to seasonal factors that the statistical office has difficulty in clearing.
Data from the Ministry of Commerce also shows that the contribution of consumption is higher (0.6%, not 0.3%). The net exports added 0.13 percentage points to GDP growth, not to 0.07%, according to the first estimate. On the other hand, the stock has erased 1.07 points from the increase, which is more than 0.93 points, as previously thought.
The non-residential fixed investments, which represent expenses for equipment, structures and intellectual property, grow by 11.4% – a five-year high – not by 9.4%.
The corporate earnings are up 3.7% on a year-on-year basis, a third consecutive quarter-on-quarter increase.
According to forecasts by economists, the US economy will grow by 3% in the second quarter and by 2.2% this year.
The final reading of the data is expected in July.