The GDP Print – Next Stop 10% ?

March 17, 2010 9:05 am

At this rate, there is no stopping this growth. Well, of course if we happen to turn of the stiulus spigot… Or, we get a prnt that is not from an severe inventory restock…. Or, if it were not from such a low base….Or……

Just recently, we were all WOW’d with the latest revision to GDP as shown below. Probably the most impressive takeaway was the PCE which topped. But consumption was adjusted down, this contradicts the last statement…

The numbers:

  • US GDP Annualized (Q4 S) Q/Q 5.9% vs. Exp. 5.7% (Prev. 5.7%)
  • US GDP Price Index (Q4 S) Q/Q 0.4% vs. Exp. 0.6% (Prev. 0.6%)
  • US Personal Consumption (Q4 S) Q/Q 1.7% vs. Exp. 2.0% (Prev. 2.0%)
  • US Core PCE (Q4 S) Q/Q 1.6% vs. Exp. 1.4% (Prev. 1.4%)
  • US ISM New York Index (Feb) M/M 417.4 vs. Prev. 403.9


Real GDP for Q4 2009 was revised up from 5.7% to 5.9% in the second estimate. The consensus expected GDP to remain at 5.7%.

Even though the total revision was small in magnitude, it was fairly volatile across all sectors.

The biggest change between the advance report and the second estimate occurred in the investment section. Total private investment grew 48.9% in the second release, up from 39.3% in the advance estimate. The revisions to investment growth boosted fourth quarter GDP by 0.81 percentage points.

Unfortunately, negative revisions to service consumption, net exports, and government spending reduced GDP by 0.24, 0.20, and 0.21 percentage points, respectively.

Inflation stayed low as the GDP deflator was revised down from 0.6 to 0.4%.

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