| Actual | Previous | Revised | |
|---|---|---|---|
| Quarter over Quarter [Adjusted] | 0.2% | 0.4% | |
| Year over Year [Not Adjusted] | 1.5% | 2.0% | 1.9% |
Highlights
Economic growth slowed down in the fourth quarter. Following an unrevised 0.4 percent quarterly increase in the third quarter, GDP expanded 0.2 percent, a couple of ticks below the flash GDP. Annual growth was 1.5 percent, down from a revised 1.9 percent last time. GDP grew 1.3 percent in 2024, up from 0.7 percent in 2023.
Household consumption rose a quarterly 0.5 percent, an increase matched by government consumption. Equipment spending also rose 1.0 percent, offsetting a 1.4 percent decline in the third quarter. Construction was again solid, up a further 0.5 percent.
Growth was also strengthened by net foreign trade. Exports were strong with sales of goods (excluding valuables) up a sizeable 6.9 percent on the quarter and of services up 2.5 percent. Goods imports also rose 1.7 percent while imports of services rose 0.5 percent.
Household consumption rose a quarterly 0.5 percent, an increase matched by government consumption. Equipment spending also rose 1.0 percent, offsetting a 1.4 percent decline in the third quarter. Construction was again solid, up a further 0.5 percent.
Growth was also strengthened by net foreign trade. Exports were strong with sales of goods (excluding valuables) up a sizeable 6.9 percent on the quarter and of services up 2.5 percent. Goods imports also rose 1.7 percent while imports of services rose 0.5 percent.
Definition
Gross domestic product (GDP) is the broadest measure of aggregate economic activity and encompasses every sector of the economy. There is no flash estimate and the first report is typically not issued until around sixty days after the end of the reference quarter. This has the advantage of limiting the size of any future revision and also accommodates the inclusion of the GDP expenditure components.
Description
GDP is the all-inclusive measure of economic activity. Investors need to closely track the economy because it usually dictates how investments will perform. Investors in the stock market like to see healthy economic growth because robust business activity translates to higher corporate profits. Bond investors are more highly sensitive to inflation and robust economic activity could potentially pave the road to inflation. By tracking economic data such as GDP, investors will know what the economic backdrop is for these markets and their portfolios.
The GDP report contains a treasure-trove of information which not only paints an image of the overall economy, but tells investors about important trends within the big picture. GDP components such as consumer spending, business and residential investment, and price (inflation) indexes illuminate the economy's undercurrents, which can translate to investment opportunities and guidance in managing a portfolio.
The GDP report contains a treasure-trove of information which not only paints an image of the overall economy, but tells investors about important trends within the big picture. GDP components such as consumer spending, business and residential investment, and price (inflation) indexes illuminate the economy's undercurrents, which can translate to investment opportunities and guidance in managing a portfolio.
