Real second-quarter gross domestic product fell 31.7% at an annualized rate, according to the second estimate released Thursday by the Bureau of Economic Analysis.
What Happened: The GDP figures are updated to reflect new information used to calculate GDP. In the advance estimate released last month, the second-quarter decrease in real GDP was 32.9%.
The second estimate shows that private inventory investment and personal consumption expenditures decreased less than previously estimated.
After increasing 3.1% during the fourth quarter of 2019, real gross domestic income experienced a 4.3% decrease during the first quarter.
Real GDP is the inflation-adjusted value of the goods and services produced by labor and property located in the United States.
Why It’s Important: Despite the slight improvement, the second-quarter GDP estimate remains the worst in recorded history.
Imports and exports both saw decreases; the price index for gross domestic purchases decreased 1.5% in the second quarter.
These decreases affected profits, with profits from current production — corporate profits with inventory valuation and capital consumption adjustments — decreasing $226.9 billion in the second quarter.
What’s Next: The large decrease in second-quarter GDP was expected after the coronavirus pandemic paralyzed the economy.
Falling imports and exports could lead to a sustained decrease that bleeds into future quarters.
The third estimates for second-quarter GDP are set for release Sept. 30.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
