28 June, AtoZForex – Quarterly change in the inflation-adjusted value of all goods and services produced by US economy has beat the market expectations of 1% by 0.1%.
However, after the vote for Brexit market focus has shifted to economic and politic developments in Europe. Because of this US Final GDP estimate did not move the market by much.
US Final GDP
The 1.1% increase in real GDP in the first quarter “reflected positive contributions from personal consumption expenditures (PCE), residential fixed investment, state and local government spending, and exports that were partly offset by negative contributions from nonresidential fixed investment, private inventory investment, and federal government spending,” the statement said. While imports, which are a subtraction in the calculation of GDP, decreased.
Although US Final GDP beat the expectations slightly, the number does not represent a strong economy, supporting no Fed rate hike view for the upcoming FOMC meeting.
While this is q/q data, it is reported in an annualized format. The previous GDP reading of 0.8% listed is the actual number from the Preliminary release and therefore history of the data will appear unconnected. We have in total three versions of GDP released a month apart – Advance, Preliminary, and Final. The Advance publication is the earliest and thus tends to have the most impact on the market.
Think we missed something? Let us know in the comments section below.