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Gross Domestic Product, 1st quarter 2018 (advance estimate)

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National Income and Product Accounts Gross Domestic Product: First Quarter 2018 (Advance Estimate) Real gross domestic product (GDP) increased at an annual rate of 2.3 percent in the first quarter of 2018 (table 1), according to the "advance" estimate released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 2.9 percent. The Bureau emphasized that the first-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see “Source Data for the Advance Estimate” on page 2). The "second" estimate for the first quarter, based on more complete data, will be

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National Income and Product Accounts
Gross Domestic Product: First Quarter 2018 (Advance Estimate)


Real gross domestic product (GDP) increased at an annual rate of 2.3 percent in the first quarter of 2018
(table 1), according to the "advance" estimate released by the Bureau of Economic Analysis. In the
fourth quarter, real GDP increased 2.9 percent.

The Bureau emphasized that the first-quarter advance estimate released today is based on source data
that are incomplete or subject to further revision by the source agency (see “Source Data for the
Advance Estimate” on page 2). The "second" estimate for the first quarter, based on more complete
data, will be released on May 30, 2018.
Gross Domestic Product, 1st quarter 2018 (advance estimate)
The increase in real GDP in the first quarter reflected positive contributions from nonresidential fixed
investment, personal consumption expenditures (PCE), exports, private inventory investment, federal
government spending, and state and local government spending.  Imports, which are a subtraction in
the calculation of GDP, increased (table 2).

The deceleration in real GDP growth in the first quarter reflected decelerations in PCE, residential fixed
investment, exports, and state and local government spending.  These movements were partly offset by
an upturn in private inventory investment.  Imports, which are a subtraction in the calculation of GDP,
decelerated.

Current-dollar GDP increased 4.3 percent, or $211.2 billion, in the first quarter to a level of $19.97
trillion. In the fourth quarter, current-dollar GDP increased 5.3 percent, or $253.5 billion (table 1 and
table 3).

The price index for gross domestic purchases increased 2.8 percent in the first quarter, compared with
an increase of 2.5 percent in the fourth quarter (table 4). The PCE price index increased 2.7 percent, the
same increase as in the fourth quarter. Excluding food and energy prices, the PCE price index increased
2.5 percent, compared with an increase of 1.9 percent (appendix table A).


Personal Income (table 10)

Current-dollar personal income increased $182.1 billion in the first quarter, compared with an increase
of $186.4 billion in the fourth quarter. Decelerations in personal interest income, rental income, and
nonfarm proprietors' income were largely offset by accelerations in wages and salaries and in
government social benefits.

Personal current taxes decreased $40.1 billion in the first quarter compared with an increase of $50.1
billion in the fourth quarter.

Disposable personal income increased $222.1 billion, or 6.2 percent, in the first quarter, compared with
an increase of $136.3 billion, or 3.8 percent, in the fourth quarter. Real disposable personal income
increased 3.4 percent, compared with an increase of 1.1 percent.

Personal saving was $462.1 billion in the first quarter, compared with $379.8 billion in the fourth
quarter. The personal saving rate -- personal saving as a percentage of disposable personal income --
was 3.1 percent in the first quarter, compared with 2.6 percent in the fourth quarter.

The 2017 Tax Cuts and Jobs Act includes provisions that impact the personal income statistics in the
National Income and Product Accounts. For more information, see the Technical Note.


Source Data for the Advance Estimate

Information on the assumptions used for unavailable source data in the advance estimate is provided in
a Technical Note that is posted with the news release on BEA’s Web site. A detailed "Key Source Data
and Assumptions" file is also posted for each release. For information on updates to GDP, see the
"Additional Information" section that follows.


Upcoming Comprehensive Update of the National Income and Product Accounts

BEA will release the results of the 15th comprehensive (or benchmark) update of the national
income and product accounts (NIPAs) in conjunction with the second quarter 2018 "advance"
estimate on July 27, 2018.  For more information, see the Technical Note. Details on the planned
statistical, definitional, and presentational changes are available in the April Survey of Current
Business article "Preview of the 2018 Comprehensive Update of the National Income and Product
Accounts." An article in the September Survey will describe the estimates in detail.  Revised NIPA
table stubs and news release stubs will be available in June.


                                          *          *          *

                               Next release:  May 30, 2018, at 8:30 A.M. EDT
                      Gross Domestic Product:  First Quarter 2018 (Second Estimate)
                      Corporate Profits:  First Quarter 2018 (Preliminary Estimate)

                                          *          *          *



                                           Additional Information

Resources

Additional resources available at www.bea.gov:
•	Stay informed about BEA developments by reading the BEA blog, signing up for BEA’s email
        subscription service, or following BEA on Twitter @BEA_News.
•	Historical time series for these estimates can be accessed in BEA’s Interactive Data Application.
•	Access BEA data by registering for BEA’s Data Application Programming Interface (API).
•	For more on BEA’s statistics, see our monthly online journal, the Survey of Current Business.
•	BEA's news release scheduleNIPA Handbook:  Concepts and Methods of the U.S. National Income and Product Accounts

Definitions

Gross domestic product (GDP) is the value of the goods and services produced by the nation’s economy
less the value of the goods and services used up in production. GDP is also equal to the sum of personal
consumption expenditures, gross private domestic investment, net exports of goods and services, and
government consumption expenditures and gross investment.

Current-dollar estimates are valued in the prices of the period when the transactions occurred—that is,
at “market value.” Also referred to as “nominal estimates” or as “current-price estimates.”
Real values are inflation-adjusted estimates—that is, estimates that exclude the effects of price changes.
The gross domestic purchases price index measures the prices of final goods and services purchased by
U.S. residents.

The personal consumption expenditure price index measures the prices paid for the goods and services
purchased by, or on the behalf of, “persons.”

Personal income is the income received by, or on behalf of, all persons from all sources:  from
participation as laborers in production, from owning a home or business, from the ownership of
financial assets, and from government and business in the form of transfers. It includes income from
domestic sources as well as the rest of world. It does not include realized or unrealized capital gains or
losses.

Disposable personal income is the income available to persons for spending or saving. It is equal to
personal income less personal current taxes.

Personal outlays is the sum of personal consumption expenditures, personal interest payments, and
personal current transfer payments.

Personal saving is personal income less personal outlays and personal current taxes.
The personal saving rate is personal saving as a percentage of disposable personal income. (For a
comparison of personal saving in BEA's national income and product accounts (NIPAs) with personal
saving in the Federal Reserve Board's financial accounts of the United States, go to
www.bea.gov/national/nipaweb/nipa-frb.asp.

For more definitions, see the Glossary: National Income and Product Accounts.


Statistical conventions

Annual rates. Quarterly values are expressed at seasonally-adjusted annual rates (SAAR), unless
otherwise specified. Dollar changes are calculated as the difference between these SAAR values. For
detail, see the FAQ “Why does BEA publish estimates at annual rates?”

Percent changes in quarterly series are calculated from unrounded data and are displayed at annual
rates, unless otherwise specified. For details, see the FAQ “How is average annual growth calculated?”

Quantities and prices. Quantities, or “real” volume measures, and prices are expressed as index
numbers with a specified reference year equal to 100 (currently 2009). Quantity and price indexes are
calculated using a Fisher-chained weighted formula that incorporates weights from two adjacent
periods (quarters for quarterly data and annuals for annual data). “Real” dollar series are calculated by
multiplying the published quantity index by the current dollar value in the reference year (2009) and
then dividing by 100. Percent changes calculated from real quantity indexes and chained-dollar levels
are conceptually the same; any differences are due to rounding.

Chained-dollar values are not additive because the relative weights for a given period differ from those
of the reference year. In tables that display chained-dollar values, a “residual” line shows the difference
between the sum of detailed chained-dollar series and its corresponding aggregate.


Updates to GDP

BEA releases three vintages of the current quarterly estimate for GDP:  "Advance" estimates are
released near the end of the first month following the end of the quarter and are based on source data
that are incomplete or subject to further revision by the source agency; “second” and “third” estimates
are released near the end of the second and third months, respectively, and are based on more detailed
and more comprehensive data as they become available.

Annual and comprehensive updates are typically released in late July. Annual updates generally cover at
least the 3 most recent calendar years (and their associated quarters) and incorporate newly available
major annual source data as well as some changes in methods and definitions to improve the accounts.
Comprehensive (or benchmark) updates are carried out at about 5-year intervals and incorporate major
periodic source data, as well as major conceptual improvements.
The table below shows the average revisions to the quarterly percent changes in real GDP between
different estimate vintages, without regard to sign.

Vintage                               Average Revision Without Regard to Sign
                                         (percentage points, annual rates)
Advance to second                                     0.5
Advance to third                                      0.6
Second to third                                       0.2
Advance to latest                                     1.3
Note - Based on estimates from 1993 through 2016. For more information on GDP
updates, see Revision Information on the BEA Web site.

The larger average revision from the advance to the latest estimate reflects the fact that periodic
comprehensive updates include major statistical and methodological improvements.

Unlike GDP, an advance current quarterly estimate of GDI is not released because data on domestic
profits and on net interest of domestic industries are not available. For fourth quarter estimates, these
data are not available until the third estimate.
Bureau of Economic Analysis
The BEA Advisory Committee advises the Director of BEA on matters related to the development and improvement of BEA’s national, regional, industry, and international economic accounts, especially in areas of new and rapidly growing economic activities arising from innovative and advancing technologies, and provides recommendations from the perspectives of the economics profession, business, and government.

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