Economy: Gross Domestic Product (GDP) "Preliminary" Released Today for Q4, 2006

The preliminary, real U.S. Gross Domestic Product (GDP) report for the fourth quarter of 2006 was released this morning:

Predicted: +2.3%
Actual: +2.2%

The above percentages represent the quarter-to-quarter change in the Gross Domestic Product for the United States. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the actual or real figure. The GDP report is produced by the U.S. Commerce Department's Bureau of Economic Analysis.

The final GDP report for Q4, 2006, which will contain the most authoritative data for the fourth quarter, will be released on March 29, 2007.

The GDP is a very broad measure of economic activity for the entire United States, covering all sectors of the economy. The Commerce Department defines real GDP as, "the output of goods and services produced by labor and property located in the United States."

Here's a snippet from a press release (PDF) issued by the Commerce Department this morning:

"Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 2.2 percent in the fourth quarter of 2006, according to preliminary estimates released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 2.0 percent.

The GDP estimates released today are based on more complete source data than were available for the advance estimates issued last month. In the advance estimates, the increase in real GDP was 3.5 percent (see "Revisions" on page 3).

The increase in real GDP in the fourth quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, state and local government spending, and federal government spending that were partly offset by negative contributions from private inventory investment and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, decreased.

The small acceleration in real GDP growth in the fourth quarter primarily reflected a downturn in imports and accelerations in PCE, in exports, and in federal government spending that were partly offset by downturns in private inventory investment, in equipment and software, and in nonresidential structures.

Final sales of computers contributed 0.23 percentage point to the fourth-quarter growth in real DP after contributing 0.07 percentage point to the third-quarter growth. Motor vehicle output subtracted 1.24 percentage points from the fourth-quarter growth in real GDP after contributing 0.76 percentage point to the third-quarter growth."

Click here to view the full Commerce Department report (PDF).

Labels: 2006, fourth_quarter, GDP, gross_domestic_product