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 3.3 percent in the second quarter of 1997, according to revised estimates released by the Commerce Department's Bureau of Economic Analysis. In the first quarter, real GDP increased 4.9 percent. Real GDP increased $58.0 billion in the second quarter, following an increase of $84.2 billion in the first.

The GDP estimates released today are based on more complete source data than were available for the preliminary estimates issued last month. In the preliminary estimates, the increase in real GDP was 3.6 percent.

The increase in second-quarter real GDP was more than accounted for by increases in exports of goods and services, in producers' durable equipment, in consumption expenditures for services, and in inventory investment. The smaller increase in real GDP in the second quarter than in the first was more than accounted for by a downturn in personal consumption expenditures for goods and by a deceleration in inventory investment.

The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 0.8 percent in the second quarter, compared with an increase of 1.9 percent in the first. The smaller second- quarter increase was mainly accounted for by a downturn in energy prices.

Real personal consumption expenditures increased 0.9 percent in the second quarter, compared with an increase of 5.3 percent in the first. Real nonresidential fixed investment increased 14.6 percent, compared with an increase of 4.1 percent. Nonresidential structures decreased 4.7 percent, compared with a decrease of 2.1 percent. Producers' durable equipment increased 23.0 percent, compared with an increase of 6.7 percent. Real residential fixed investment increased 7.4 percent, compared with an increase of 3.3 percent.

Real exports of goods and services increased 18.4 percent in the second quarter, compared with an increase of 9.9 percent in the first. Real imports of goods and services increased 20.5 percent, compared with an increase of 17.9 percent.

Real federal government consumption expenditures and gross investment increased 6.6 percent in the second quarter, in contrast to a decrease of 5.8 percent in the first. National defense increased 7.5 percent, in contrast to a decrease of 11.8 percent. Nondefense increased 4.9 percent, compared with an increase of 8.0 percent. Real state and local government increased 1.2 percent, compared with an increase of 2.7 percent.

Real final sales of domestic product increased 2.5 percent in the second quarter, compared with an increase of 3.0 percent in the first.

The real change in business inventories added 0.8 percentage point to the second-quarter change in real GDP, after adding 1.8 percentage points to the first-quarter change. Businesses increased inventories $77.6 billion in the second quarter, following an increase of $63.7 billion in the first quarter and an increase of $32.9 billion in the fourth.

			96-IV		97-I	97-II-R
Current- Dollar Measures

Gross Domestic Product   7,792.9	7,933.6	8,034.3
Final Sales of Domestic
 Product (GDP less CBI)  7,761.0	7,867.4	7,953.2
Gross Domestic Purchases 7,881.5	8,032.4	8,123.1
Final Sales To Domestic
Purchasers		 7,849.6	7,966.3	8,042.0
Gross National Product	 7,796.1	7,919.2	8,013.6

			96-IV		97-I	97-II-R
Current-Dollar Measures
Gross Domestic 
	Product (GDP)	 6.2		7.4	5.2

Final Sales of Domestic 
Product (GDP less CBI)	 6.6		5.6	4.4
Gross Domestic Purchases 4.8		7.9	4.6
Final Sales To Domestic 
	Purchasers	 5.1		6.1	3.9
Gross National Product	 6.8 		6.5	4.9

Gross Domestic Purchases

Real gross domestic purchases–purchases by U.S. residents of goods and services wherever produced–increased 3.7 percent in the second quarter, compared with an increase of 5.9 percent in the first.

Gross National Product

Real gross national product–the goods and services produced by the labor and property supplied by U.S. residents–increased 3.0 percent in the second quarter, compared with an increase of 4.0 percent in the first. GNP includes, and GDP excludes, net receipts of factor income from the rest of the world.

Current-Dollar GDP

Current-dollar GDP–the market value of the nation's output of goods and services–increased 5.2 percent, or $100.7 billion, in the second quarter. In the first quarter, current- dollar GDP increased 7.4 percent, or $140.7 billion.

Revisions

The final estimate of the second- quarter increase in real GDP is 0.3 percentage point, or $5.5 billion, less than the preliminary estimate issued last month. The largest downward revision was to exports of goods ($4.1 billion).

The final estimate of the second-quarter increase in the price index for gross domestic purchases is 0.8 percent, the same as in the preliminary estimate.

September 26, 1997 U.S. Department of Commerce

Consensus National Futures and Financial On Line Index

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