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THURSDAY, August 27, 2009 GDP DECLINES 1.0 PERCENT IN SECOND QUARTER Second Estimate of GDP Real gross domestic product (GDP) declined 1.0 percent in the second quarter of 2009, following a 6.4 percent decline in the first quarter, according to the “second” estimate released today by the Bureau of Economic Analysis. The estimate for the second quarter was unrevised from the “advance” estimate released in July. Gross Domestic Product As in the previous estimates, the smaller decrease in real GDP reflected: • • • Much smaller decreases in business investment and exports An upturn in government spending Smaller declines in private inventory investment and housing However, consumer spending turned down, and imports declined less than in the first quarter. Quarter-to-Quarter Growth in Real GDP 6 4 Percent 2 0 -2 -4 -6 -8 III IV 2005 I II III 2006 IV I II III 2007 IV I II III 2008 IV I II 2009 Real GDP growth is measured at seasonally adjusted annual rates. Corporate Profits Second-quarter corporate profits rose 5.7 percent at a quarterly rate. Nonfinancial corporate profits increased 4.5 percent, and financial corporate profits rose 16.7 percent. Quarter-to-Quarter Growth in Corporate Profits 15 10 5 Percent 0 -5 -10 -15 -20 -25 III IV I II 2005 III IV 2006 I II III IV 2007 I II III IV 2008 I II 2009 Corporate profits growth is measured as the percent change from the previous quarter. BEA data—including GDP, personal income, the balance of payments, foreign direct investment, the input-output accounts, and economic data for states, local areas, and industries—are available on the BEA Web site: www.bea.gov. E-mail alerts are also available. NOTE: Additional information that becomes available in the coming weeks will be incorporated in a “third” estimate of second-quarter GDP on September 30, 2009. A revised estimate of corporate profits will also be released. Contact: Ralph Stewart or Thomas Dail (202) 606-2649 Bureau of Economic Analysis, U.S. Department of Commerce