Real gross domestic product increased at an annual rate of 1.4 percent in the first quarter of 2024, according to the “third” estimate. In the fourth quarter of 2023, real GDP increased 3.4 percent. The increase in the first quarter primarily reflected increases in consumer spending, housing investment, business investment, and state and local government that were partly offset by a decrease in inventory investment. Imports, which are a subtraction in the calculation of GDP, increased.
- The increase in consumer spending reflected an increase in services that was partly offset by a decrease in goods. Within services, the leading contributors to the increase were health care as well as financial services and insurance. Within goods, the leading contributors to the decrease were motor vehicles and parts as well as gasoline and other energy goods.
- The increase in housing investment was led by brokers’ commissions and other ownership transfer costs as well as new single-family housing construction.
- The decrease in inventory investment was led by decreases in wholesale trade and manufacturing. Compared to the fourth quarter, the deceleration in real GDP primarily reflected decelerations in consumer spending, exports, and state and local government spending, and a downturn in federal government spending. These movements were partly offset by an acceleration in residential fixed investment. Imports accelerated.
Updates to GDP
The GDP estimate for the first quarter was revised up 0.1 percentage point from the “second” estimate. The upward revision primarily reflected a downward revision to imports, which are a subtraction in the calculation of GDP, and upward revisions to business investment and government spending. These revisions were partly offset by a downward revision to consumer spending. For additional details on the estimates, refer to the Technical Note.
Prices
Gross domestic purchases prices, the prices of goods and services purchased by U.S. residents, increased 3.1 percent in the first quarter after increasing 1.9 percent in the fourth quarter. Excluding food and energy, prices increased 3.3 percent after increasing 2.1 percent.
Personal consumption expenditures prices increased 3.4 percent in the first quarter after increasing 1.8 percent in the fourth quarter. Excluding food and energy, the PCE “core” price index increased 3.7 percent after increasing 2.0 percent.
Personal income and saving
Real disposable personal income —personal income adjusted for taxes and inflation— increased 1.3 percent in the first quarter after increasing 0.9 percent in the fourth quarter.
Current-dollar DPI increased 4.8 percent in the first quarter, following an increase of 2.7 percent in the fourth quarter. The increase in the first quarter primarily reflected increases in compensation and government social benefits. Personal current taxes, which are a subtraction in the calculation of DPI, increased.
Profits decreased 1.4 percent at a quarterly rate in the first quarter after increasing 4.1 percent in the fourth quarter.
- Profits of domestic financial corporations increased 14.2 percent after increasing 1.3 percent.
- Profits of domestic nonfinancial corporations decreased 4.7 percent after increasing 5.9 percent.
- Profits from the rest of the world (net) increased 0.5 percent after decreasing 1.7 percent.
Corporate profits increased 6.4 percent in the first quarter from one year ago.
Real gross domestic product by industry
In the first quarter, the value added of private goods-producing industries decreased 1.1 percent, private services-producing industries increased 1.9 percent, and government increased 2.3 percent. Overall, 15 of 22 industry groups contributed to the first-quarter increase in real GDP.
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