Q3 Real GDP Revised to 2.1%

Last month, the government said that the economy grew by 1.5% in real terms during the third quarter. Today they bumped that up to 2.1%. Nominal GDP grew by 3.4%.

The WSJ reports:

The third-quarter boost was largely due to a sharp upward revision for private inventories, which still weighed on GDP growth, but not nearly as much as initially estimated.

Rising stockpiles help boost gross domestic product, but they could be a potential drag in the fourth quarter when those inventories are drawn down.

“The key takeaway is that the inventory adjustment that has always been inevitable for the second half of the year is likely to drag out to two, or more, quarters rather than being concentrated primarily in the third quarter,” said Stephen Stanley, chief economist at Amherst Pierpont Securities, in a note to clients. “The movement in inventories basically just shuffles growth between Q3 and Q4.”

Here’s real GDP over the last 10 years.

Posted by on November 24th, 2015 at 10:58 am

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