“The U.S. economy is growing at 4.1 percent over the first six months of this year,” U.S. Commerce Secretary Carlos M. Gutierrez said in a statement Friday from Lima, Peru, where he was leading a U.S. delegation attending the inauguration of President-elect Alan García Pérez. “Today’s GDP report confirms that America’s economy remains strong and vibrant.”
For the quarter ended June 30, however, the so-called real gross domestic product – goods and services produced by U.S. labor at facilities on U.S. soil – rose at an annual rate of only 2.5 percent, according to the U.S. Commerce Department’s Bureau of Economic Activity, whose quarterly report was released Friday morning.
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That’s a far cry from the 5.6 percent GDP growth it reported for the first quarter of 2006, or the 3-percent rise outside analysts had been predicting. The slowdown was blamed on downturns in personal spending, on both durable and nondurable goods; government spending; exports; and residential fixed investments. Those trends were partly offset by a decrease in imports and increases in private inventories and personal services.
Real disposable income edged up 1 percent in the quarter, after rising 1.7 percent in the first three months of the year. The personal savings rate, however, decreased from the first quarter’s negative 1.0 percent to negative 1.5 percent as spending and borrowing outpaced new savings.
The total current-dollar GDP – all U.S. goods and services – rose 5.8 percent in the second quarter, to $13,194 billion. In the first quarter, that index had risen 9.0 percent.
The figures are subject to further revision, the bureau noted. Its Friday report included annual revisions to GDP figures for 2003, 2004, and 2005.
The percent change in GDP from the previous year was revised downward in every case; the new figures are 2.5-percent GDP growth for 2003; 3.9-percent growth for 2004; and 3.2-percent growth for 2005. Estimates of national income and current-dollar GDP also were revised downward for all three years.
The full, 35-page report can be found online at the Commerce Department Web site, www.commerce.gov/.
