The U.S. Bureau of Economic Analysis reported Thursday, July 25, that the gross domestic product (GDP) increased by 2.8% in the second quarter of 2024, up from 1.4% in the first quarter. Photo credit (https://www.tradingacademy.com/financial-education-center/)
- The increase was primarily driven by consumer spending, private inventory investment, and nonresidential fixed investment.
- Current-dollar GDP reached $28.63 trillion.
- Personal income and savings also saw increases.
- Furthermore, the Bureau will release revised statistics for GDP, GDP by Industry, and gross domestic income on September 26, 2024.
The Bureau of Economic Analysis of the United States Department of Commerce stated Thursday that the actual gross domestic product (GDP) grew at an annual rate of 2.8 percent in the second quarter of 2024, according to the "advance" estimate by the U.S. Bureau of Economic Analysis.
This is an improvement from the 1.4 percent growth in the first quarter.
However, the data released today is subject to further revision, and a more complete estimate for the second quarter will be released on August 29, 2024.
The increase in GDP was mainly due to higher consumer spending, private inventory investment, and nonresidential fixed investment. However, imports, which are subtracted in the GDP calculation, also increased.
The rise in consumer spending was driven by increases in both services and goods.
In services, the main contributors were health care, housing and utilities, and recreation services.
In goods, the leading contributors were motor vehicles and parts, recreational goods and vehicles, furnishings and durable household equipment, and gasoline and other energy goods.
The increase in private inventory investment was mainly due to growth in wholesale trade and retail trade industries, partially offset by a decrease in mining, utilities, and construction industries.
Within nonresidential fixed investment, increased equipment and intellectual property products were partly offset by decreased structures. Moreover, the increase in imports was led by capital goods, excluding automotive.
Compared to the first quarter, the acceleration in real GDP in the second quarter was primarily due to an upturn in private inventory investment and consumer spending, partly offset by a downturn in residential fixed investment.
In current-dollar terms, GDP increased by 5.2 percent at an annual rate, reaching $28.63 trillion.
The price index for gross domestic purchases rose by 2.3 percent in the second quarter, compared with an increase of 3.1 percent in the first quarter.
The personal consumption expenditures (PCE) price index increased by 2.6 percent, compared with an increase of 3.4 percent, while the PCE price index excluding food and energy prices rose by 2.9 percent, as opposed to 3.7 percent in the previous quarter.
Current-dollar personal income rose by $237.6 billion in the second quarter, primarily driven by increases in compensation and personal current transfer receipts.
Disposable personal income increased by $186.3 billion, or 3.6 percent, compared with an increase of $240.2 billion, or 4.8 percent, in the first quarter. Real disposable personal income rose by 1.0 percent, down from 1.3 percent.
Personal savings totaled $720.5 billion in the second quarter, with a personal saving rate of 3.5 percent, down from 3.8 percent in the first quarter.
Lastly, the Bureau of Economic Analysis will release results from the 2024 annual update of the National Economic Accounts, including the National Income and Product Accounts and the Industry Economic Accounts, on September 26, 2024.
This update will present revised statistics for GDP, GDP by Industry, and gross domestic income.