The US economy grew at an annual rate of 0.9 percent in the first quarter, compared with 0.6 percent in the fourth quarter, according to the “preliminary” estimates released by the Bureau of Economic Analysis. The gross domestic product (GDP) growth rate was revised up from the “advance” estimate of 0.6 percent. BEA also released first-quarter corporate profits estimates.

Gross Domestic Product

The continued slow growth in GDP reflected the same factors embodied in the advance estimate: a decline in housing and continued weakness in consumer spending.

The revision to the first-quarter growth rate reflected lower imports that were mostly offset by lower inventory investment. Lower imports implies that domestic production was higher. Also, the decrease in nonresidential construction was less than in the advance estimate.

Final sales of computers contributed 0.06 percentage point to the first-quarter growth in real GDP after contributing 0.16 percentage point to the fourth-quarter growth.  Motor vehicle output subtracted 0.35 percentage point from the first-quarter growth in real GDP after subtracting 0.86 percentage point from the fourth-quarter growth.

Corporate Profits

Year-over-year growth in the first-quarter was 1.7 percent, compared with 2.5 percent in the fourth quarter. The first-quarter increase reflected an increase in profits from foreign affiliates of US companies. In contrast, profits of domestic corporations declined.