Slowing US GDP Growth During Third Quarter Due to Consumer Spending Revision

During the third quarter of 2023, the growth of the real GDP in the United States decreased to 4.9%, down from the initial estimate of 5.2%.  

Highlights

• The real GDP growth was adjusted to 4.9% in the third quarter.
• The decline in consumer spending has affected GDP numbers.
• Contributions from various industries have bolstered the economic growth of the United States.

GDP Growth Revised Downward

The U.S. economy saw a slower growth rate in Q3 2023, with real GDP increasing by 4.9%, down from the earlier estimate of 5.2%. This was driven by reduced consumer spending, despite overall growth in various economic sectors.

Detailed Economic Indicators

The downward revision in real GDP growth contrasts with an 8.3% rise in current-dollar GDP. The price index for gross domestic purchases also experienced a slight decline, indicating muted inflationary pressures. Notably, the personal consumption expenditures (PCE) price index, excluding food and energy, was revised downward, reflecting lower inflation than initially reported.

Income and Corporate Profits

Current-dollar personal income increased, albeit slightly lower than previously stated. Disposable personal income and personal saving also underwent revisions. Corporate profits showed an overall increase, led by nonfinancial corporations.

Industry Contribution to GDP

Examination of GDP by industry revealed significant contributions from private goods-producing industries, private services-producing industries, and the government sector. Key contributors included nondurable goods manufacturing and construction, with retail trade and information services also playing substantial roles.

Short-Term Outlook: Moderate Growth

Considering these revisions and existing economic conditions, the short-term outlook suggests ongoing, though moderate, economic growth. Attention now turns to forthcoming GDP releases for Q4 2023 and the full year to gain further insights into the U.S. economy's well-being.