Real gross domestic product (GDP) increased at an annual rate of 2.8 percent in the third quarter of 2024, according to the “second” estimate. In the second quarter, real GDP increased 3.0 percent. The increase in the third quarter primarily reflected increases in consumer spending, exports, federal government spending, and business investment. Imports, which are a subtraction in the calculation of GDP, increased.
- The increase in consumer spending reflected increases in both goods and services. Within goods, the leading contributors to the increase were other nondurable goods (led by prescription drugs) and motor vehicles and parts (led by used light trucks). Within services, the leading contributor to the increase was health care (both outpatient services and hospitals).
- The increase in exports primarily reflected an increase in goods (led by capital goods, excluding automotive).
- The increase in federal government spending primarily reflected an increase in defense spending.
- The increase in business investment primarily reflected an increase in equipment (led by information processing equipment as well as transportation equipment).
- The increase in imports primarily reflected an increase in goods (led by capital goods, excluding automotive).
Compared to the second quarter, the deceleration in real GDP primarily reflected a downturn in inventory investment and a larger decrease in housing investment. These movements were partly offset by accelerations in exports, consumer spending, and federal government spending. Imports accelerated.
Prices
Gross domestic purchases prices, the prices of goods and services purchased by U.S. residents, increased 1.9 percent in the third quarter, after increasing 2.4 percent in the second quarter. Excluding food and energy, prices increased 2.4 percent, after increasing 2.6 percent.
Personal consumption expenditures (PCE) prices increased 1.5 percent in the third quarter, after increasing 2.5 percent in the second quarter. Excluding food and energy, the PCE “core” price index increased 2.1 percent, after increasing 2.8 percent.
Personal income and saving
Real disposable personal income (DPI)— personal income adjusted for taxes and inflation—increased 0.8 percent in the third quarter after increasing 1.0 percent (revised) in the second quarter.
Current-dollar DPI increased 2.3 percent in the third quarter, following an increase of 3.6 percent (revised) in the second quarter. The increase in the third quarter primarily reflected an increase in compensation.
Personal saving as a percentage of DPI was 4.3 percent in the third quarter, compared with 4.9 percent (revised) in the second quarter.
Corporate profits from current production
Profits decreased 0.3 percent at a quarterly rate in the third quarter after increasing 3.6 percent in the second quarter.
- Profits of domestic financial corporations decreased 0.4 percent after increasing 7.0 percent.
- Profits of domestic nonfinancial corporations increased 1.1 percent after increasing 4.2 percent.
- Profits from the rest of the world (net) decreased 8.0 percent after decreasing 3.8 percent.
Corporate profits increased 6.1 percent in the third quarter from one year ago.
Updates to GDP
The update from the “advance” estimate primarily reflected upward revisions to inventory investment and business investment as well as downward revisions to exports and consumer spending. Imports were revised down.
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