Tuesday, December 22, 2009

GDP Revised Downward Once Again

On Tuesday, November 24, 2009, I said, "Real Gross Domestic Product (GDP) increased at an annual rate of 2.8 percent in the third quarter of 2009, which is down from 3.5% (first estimate), according to the "second" estimate released by the Bureau of Economic Analysis (BEA). We will have one more estimate by the BEA, which will be the final one. When everything is said and done, I am looking for the third quarter GDP to be closer to 2% than the original estimate of 3.5%."

The final GDP numbers have just been released by the BEA, which shows that GDP growth for the third quarter was 2.2%, which was not too far from my estimate of 2%. This new figure was below Wall Street forecasts. Economists surveyed by Dow Jones were expecting the GDP revision to show growth of 2.7%.

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