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WEDNESDAY, September 30, 2009 GDP DECLINES IN SECOND QUARTER “Third” Estimate of GDP Real gross domestic product (GDP) declined 0.7 percent in the second quarter of 2009, following a 6.4 percent decline in the first quarter, according to estimates from the Bureau of Economic Analysis. The second-quarter growth rate was revised up 0.3 percentage point from the “second” estimate for the quarter, released in August. Investment in equipment and software (mainly software) was revised up based on new Census Bureau data. Gross Domestic Product The smaller decrease in real GDP in the second quarter compared to the first quarter reflected: • • • A much smaller decrease in business investment Smaller decreases in exports, inventory investment, and housing An upturn in government spending However, imports declined less than in the first quarter, and consumer spending turned down. 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 3.7 percent at a quarterly rate. Nonfinancial profits rose 4.7 percent, and financial profits rose 12.0 percent. Profits from the rest of the world fell 4.6 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: The “advance” estimate of GDP for the third quarter of 2009 will be released on October 29, 2009. Contact: Ralph Stewart or Thomas Dail (202) 606-2649 Bureau of Economic Analysis, U.S. Department of Commerce