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EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, Thursday, June 29, 2017
Gross Domestic Product, 1st quarter 2017 (third estimate); Corporate Profits, 1st quarter 2017 (revised estimate)
Real gross domestic product (GDP) increased at an annual rate of 1.4 percent in the first quarter of 2017 (table 1), according to the "third" estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2016, real GDP increased 2.1 percent. The GDP estimate released today is based on more complete source data than were available for the "second" estimate issued last month. In the second estimate, the increase in real GDP was 1.2 percent. With the third estimate for the first quarter, personal consumption expenditures (PCE) and exports increased more than previously estimated, but the general picture of economic growth remains the same (see "Updates to GDP" on page 2).
Real gross domestic income (GDI) increased 1.0 percent in the first quarter, in contrast to a decrease of 1.4 percent in the fourth. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 1.2 percent in the first quarter, compared with an increase of 0.3 percent in the fourth quarter (table 1). Upcoming Annual Update of the National Income and Product Accounts The annual update of the national income and product accounts, covering the first quarter of 2014 through the first quarter of 2017, will be released along with the "advance" estimate of GDP for the second quarter of 2017 on July 28. For more information, see “Preview of the 2017 NIPA Annual Update” included in the May Survey of Current Business article on “GDP and the Economy”. The increase in real GDP in the first quarter primarily reflected positive contributions from nonresidential fixed investment, exports, PCE, and residential fixed investment that were partly offset by negative contributions from private inventory investment, federal government spending, and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased. The deceleration in real GDP in the first quarter reflected a downturn in private inventory investment, a deceleration in PCE, and a downturn in state and local government spending that were partly offset by an upturn in exports, an acceleration in nonresidential fixed investment, and a deceleration in imports. Current-dollar GDP increased 3.4 percent, or $157.7 billion, in the first quarter to a level of $19,027.1 billion. In the fourth quarter, current-dollar GDP increased 4.2 percent, or $194.1 billion (table 1 and table 3). The price index for gross domestic purchases increased 2.5 percent in the first quarter, compared with an increase of 2.0 percent in the fourth quarter (table 4). The PCE price index increased 2.4 percent, compared with an increase of 2.0 percent. Excluding food and energy prices, the PCE price index increased 2.0 percent, compared with an increase of 1.3 percent (appendix table A). Updates to GDP The upward revision to the percent change in real GDP primarily reflected upward revisions to PCE and to exports which were partly offset by a downward revision to nonresidential fixed investment. For more information, see the Technical Note. For information on updates to GDP, see the "Additional Information" section that follows. Advance Estimate Second Estimate Third Estimate (Percent change from preceding quarter) Real GDP 0.7 1.2 1.4 Current-dollar GDP 3.0 3.4 3.4 Real GDI --- 0.9 1.0 Average of Real GDP and Real GDI --- 1.0 1.2 Gross domestic purchases price index 2.6 2.6 2.5 PCE price index 2.4 2.4 2.4 Corporate Profits (table 12) Profits from current production (corporate profits with inventory valuation adjustment and capital consumption adjustment) decreased $48.4 billion in the first quarter, in contrast to an increase of $11.2 billion in the fourth quarter. Profits of domestic financial corporations decreased $27.9 billion in the first quarter, in contrast to an increase of $26.5 billion in the fourth. Profits of domestic nonfinancial corporations decreased $11.1 billion, compared with a decrease of $60.4 billion. The rest-of-the-world component of profits decreased $9.4 billion, in contrast to an increase of $45.1 billion. This measure is calculated as the difference between receipts from the rest of the world and payments to the rest of the world. In the first quarter, receipts increased $5.3 billion, and payments increased $14.7 billion. * * * Next release: July 28, 2017 at 8:30 A.M. EDT Gross Domestic Product: Second Quarter 2017 (Advance Estimate) 2017 NIPA Annual Update: 2014 through First Quarter 2017 * * *