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GDP Fell 0.1% in Q4

Real gross domestic product decreased at an estimated annual rate of 0.1% for Q4 2012, according to a Bureau of Economic Analysis report released today. After rising 3.1% in the third quarter, this newest data proved disappointing to market analysts, who had expected a 1% increase.

According to the Bureau, the slump resulted mainly from negative contributions from private inventory investment, federal government spending, and exports. The main sources of growth included increases in consumer spending and fixed investment, as well as a decrease in imports.

Rising computer sales added 0.15 percentage points to fourth-quarter results, while motor vehicle output contributed 0.04 percentage points after slimming 0.25 points from Q3's GDP.

Examining longer-term trends, real GDP for 2012 increased 2.2% from 2011, a 22% increase over 2011's 1.8% increase. Personal spending increases helped boost 2012's numbers, while cuts in federal government spending accounted for the largest direct decrease.

The price index for gross domestic purchases in 2012 slowed to a 1.7% bump after increasing 2.5% in 2011. Accordingly, current-dollar GDP rose 4% in 2012, equal to 2011's percent increase.


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  • Report this Comment On January 31, 2013, at 9:21 AM, StopPrintinMoney wrote:

    It's scary how the economy is made dependable on govnt spending. Imagine in what kind of hole the economy would be if the govnt shrunk by a mere 5%???

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