Q1 Real GDP Was Revised Downward by the US Department of Commerce
As anticipated real GDP was revised downward by the Bureau of Economic Analysis. The revision shows a significant drop from the first estimates released in late April. Using year over year (YOY) calculations the real GDP dropped from a 3.13% growth rate in Q4 2006 to 1.90% in Q1 2007. The segments causing the large drop were primarily changes in private inventories and residential construction. Although neither of these segments comprises a large proportion of GDP the declines relative to last year are quite large.
It should be noted that personal consumer expenditure (PCE) remained relatively strong with a YOY real growth rate of 3.50%.