Q1 GDP Revised to +0.8%

This morning, the government revised GDP growth for the first quarter up to 0.8%. That’s still not good but it’s better than what we originally thought. This was the third quarter in a row that GDP growth decelerated, meaning the rate of growth slowed.

Revisions were modest. Compared with last month’s report, the latest figures showed a larger gain for residential investment and smaller drags on overall growth from private inventories and foreign trade.

Friday’s report also offered the first official estimate of U.S. corporate profits during the first three months of the year. Profits after tax, without inventory valuation and capital consumption adjustments, rose at a 1.9% rate from the fourth quarter.

The modest rebound came after two consecutive quarters of falling profits. Still, profits were down 3.6% last quarter compared with a year earlier.

The GDP number for the second quarter (which is nearly two-thirds done) should be much better.

Posted by Eddy Elfenbein on May 27th, 2016 at 9:45 am

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.