Q3 GDP Revised Up To 3.3%, Highest In 3 Years

After the BEA estimated that US GDP rose an already impressive 3.0% in Q3, moments ago the Department of Commerce revised its estimate for third quarter growth to 3.3% annualized, higher than the 3.2% print expected, the highest since the third quarter of 2014.

On a Y/Y basis, GDP rose by 2.3%, the highest since Q3 2015:

The increase in real GDP reflected increases in consumer spending, inventory investment, business investment, and exports. A notable offset to these increases was a decrease in housing investment. Imports, which are a subtraction from GDP, decreased. The increase in consumer spending reflected increases in spending on both goods and services. The increase in goods was primarily  attributable to motor vehicles. The increase in services primarily reflected increases in health care, financial services and insurance, and recreation services. The increase in inventory investment primarily reflected increases in the manufacturing and wholesale trade industries. The increase in business investment reflected increases in equipment and intellectual property products; these increases were partly offset by a decrease in structures.

Putting numbers to the data, Q3 Consumer Expenditures were revised modestly lower, from contributing 1.62% to the bottom line GDP, to 1.60%. This however was offset by upward revisions to all other GDP components, from Fixed Investment (from 0.25% to 0.39%) and Private Inventories (0.73% to 0.80%), to net trade (from 0.40% to 0.44%) and finally, government consumption, which also rose from -0.02% to 0.07%.

Some other numbers: Core PCE 1.4%, in line with the expected and above 1.3% from the initial estimate. PCE Prices rose 1.5% in Q3, same as consensus and unchanged from the initial estimate. The GDP Deflator came in a little weaker than expected, at 2.1% vs 2.2% exp. That miss however was offset by GDP Sales, which rose from 2.3% in the preliminary report to 2.5%, above the 2.4% expected.

Also notable in today's release was the Corporate Profits number, which surged at a 4.3% annual rate in Q3, after increasing 0.7 percent in the second quarter.  Year over year corporate profits are up 5.4% in 3Q after rising 6.4% prior quarter, driven by financial industry profits which increased 13.7% in 3Q after falling 7.1% prior quarter. Also notable: Federal Reserve bank profits up 1.5% in 3Q after falling 10.6% prior quarter, while the nonfinancial sector profits rose 1% in 3Q after rising 4.9% prior quarter.

Comments

MFL5591 Wed, 11/29/2017 - 08:58 Permalink

Laughable!  This is the stock market run up by the Banker criminals.  The whole system is a lie from the shootings to the financial games tothe theater with Insane McCain

MuffDiver69 Wed, 11/29/2017 - 09:13 Permalink

The interesting thing is only eight of thirty two quarters were above 3% under Obama...His Marxist thugs regulated and strangled mid to small business and then Obamacare kicked in..and he managed to double the nations debt at same time..That is amazing in many ways with the money printed...Even without Trump deregulating on a historic basis a historically normal economic managing President would have done much better then Obama and his goon squad..

gm_general Wed, 11/29/2017 - 09:25 Permalink

Stinks about as much as Hillary's &^$%^. Next you will tell me the laws of gravity are rescinded and I can fly to work. The debt is still here and its still weighing on the economy - I will be very interested in seeing next month how much it increased in the Flow of Funds report. The only way I could see it happening is a massive increase in private debt.

Dontblamethegoat Wed, 11/29/2017 - 10:24 Permalink

It's all make believe statistical bull shit. So we made more iron, steel, lumber, grain, tanks, cars, trucks, airplanes, RVs, ships, etcs?Or did we 'make' more 'profits' off of CDOs, loans, and commissions selling stocks and bonds? So much crap, and we are supposed to lap it up with our 'hedonistically adjusted' pink mystery meat we now buy instead of sirloin steaks? 

Consuelo Wed, 11/29/2017 - 10:39 Permalink

  Although the 2nd paragraph (largest out of the 5), somewhat breaks down the detail, a bit more 'granularity' would help in seeing what products are being manufactured (and where), what type of equipment, trade and intellectual property products we're talking about. In other words: Ex-aircraft, defense, automobiles, rising health-care costs, social media and bartenders, where are we really at...?