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Most important info in the report is the benchmark revisions: The first year of the recession (Q4 2007-Q3 2008) was revised from -0.8% to -1.9%. This adds a full percentage point to the Fedâ€™s output gap measure. Also, Q2 2009 negative print marks first time U.S. economy has had four consecutive quarters of negative growth since 1947.
Q4 2008 was revised from -6.4% to -5.5%; Q1 2009 from -5.4% to -6.3%
The weaker Q1 number (especially inventories) led to the Q2 inventory drag being less than expected (-0.8%) and hence Q2 being less negative than expected at -1%.
The other components of GDP were either in line or weaker than expected. All numbers below are annualized rate of change:
- Private consumption: -1.2% vs 0.6%
- Non-residential fixed investment: -8.9% vs -43.6%
- Residential fixed-investment (housing): -29.3% vs -38.2%
- Exports: -7% vs -29.9%
- Govt: 5.6% vs -2.6%
ECI posts second lowest advance on record at 0.4% (after 0.3% prior quarter).