Revised 1st Qtr GDP

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 0.9 percent in the first quarter of 2008,according to preliminary estimates released by the Bureau of Economic Analysis. In the fourth quarter,real GDP increased 0.6 percent. The GDP estimates released today are based on more complete source data than were available for the advance estimates issued last month.
In the advance estimates, the increase in real GDP was 0.6percent (see "Revisions" on page 3). The increase in real GDP in the first quarter primarily reflected positive contributions from personal consumption expenditures (PCE) for services, exports of goods and services, federal government spending, and private inventory investment that were partly offset by negative contributions from residential fixed investment and PCE for durable goods. Imports, which are a subtraction in the calculation of GDP, decreased. The small acceleration in real GDP primarily reflected an upturn in inventory investment that was partly offset by a deceleration in PCE. Final sales of computers contributed 0.06 percentage point to the first-quarter growth in real GDP after contributing 0.16 percentage point to the fourth-quarter growth. Motor vehicle output subtracted 0.35 percentage point from the first-quarter growth in real GDP after subtracting 0.86 percentage point from the fourth-quarter growth.

The price index for gross domestic purchases, which measures prices paid by U.S. residents,increased 3.5 percent in the first quarter, the same as in the advance estimate; this index increased 3.7 percent in the fourth quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 2.2 percent in the first quarter, compared with an increase of 2.3 percent in thefourth. About 0.3 percentage point of the first-quarter increase in the index was accounted for by the pay raise for federal civilian and military personnel, which is treated as an increase in the prices of employee services purchased by the federal government.

Real personal consumption expenditures increased 1.0 percent in the first quarter, compared with an increase of 2.3 percent in the fourth. Real nonresidential fixed investment decreased 0.2 percent, incontrast to an increase of 6.0 percent. Nonresidential structures increased 1.1 percent, compared with an increase of 12.4 percent. Equipment and software decreased 0.9 percent, in contrast to an increase of 3.1 percent. Real residential fixed investment decreased 25.5 percent, compared with a decrease of 25.2 percent. Real exports of goods and services increased 2.8 percent in the first quarter, compared with an increase of 6.5 percent in the fourth. Real imports of goods and services decreased 2.6 percent,compared with a decrease of 1.4 percent. Real federal government consumption expenditures and gross investment increased 4.4 percent in the first quarter, compared with an increase of 0.5 percent in the fourth. National defense increased 5.6 percent, in contrast to a decrease of 0.5 percent. Nondefense increased 1.8 percent, compared with anincrease of 2.8 percent.

Real state and local government consumption expenditures and gross investment increased 0.6 percent, compared with an increase of 2.8 percent. The real change in private inventories added 0.21 percentage point to the first-quarter change inreal GDP, after subtracting 1.79 percentage points from the fourth-quarter change. Private businesses decreased inventories $14.4 billion in the first quarter, following a decrease of $18.3 billion in the fourth quarter and an increase of $30.6 billion in the third. Real final sales of domestic product -- GDP less change in private inventories -- increased 0.7 percent in the first quarter, compared with an increase of 2.4 percent in the fourth.