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Real GDP (gross domestic product) -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 6.1 percent in the first quarter of 2009, (that is, from the fourth quarter to the first quarter), according to advance estimates released by the Bureau of Economic Analysis. In the fourth quarter, real GDP decreased 6.3 percent. The report marked the weakest six months since 1957-58.
The Bureau emphasised that the first-quarter “advance” estimates are based on source data that are incomplete or subject to further revision by the source agency. The first-quarter “preliminary” estimates, based on more comprehensive data, will be released on May 29, 2009.
The decrease in real GDP in the first quarter primarily reflected negative contributions from exports, private inventory investment, equipment and software, nonresidential structures, and residential fixed investment that were partly offset by a positive contribution from personal consumption expenditures (PCE). Imports, which are a subtraction in the calculation of GDP, decreased.
Consumer spending grew 2.2 percent in the first quarter after falling 4.3 percent in the fourth quarter.
The increase in consumer spending was offset by larger declines in:
Smaller stockpiles may set the stage for a return to growth in the second half of the year.
Prices
Prices of goods and services purchased by U.S. residents (gross domestic purchases) fell 1.0 percent, following a 3.9 percent decrease in the fourth quarter. Energy prices decreased less than in the fourth quarter. Excluding food and energy, prices rose 1.4 percent after rising 1.2 percent.
Personal Income
Real disposable personal income (DPI)—income adjusted for inflation and taxes—rose 6.2 percent in the first quarter after rising 2.7 percent in the fourth quarter. The increase reflected reduced tax payments and an increase in transfer payments, as wages and salaries declined. In addition, lower prices boosted real DPI.
