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Gross Domestic Product
Second Quarter of 2019 (Third Estimate)
September 26, 2019
This technical note provides background information about the source data and estimating methods
used to produce the estimates presented in the GDP news release. The complete set of estimates for
the second quarter is available on BEA's Web site at www.bea.gov; a brief summary of "highlights" is
also posted on the Web site. BEA's source data and assumptions for the "third" estimate are shown in a
"Key Source Data and Assumptions" table on the BEA Web site. In a few weeks, the Survey of Current
Business, BEA’s online monthly journal, will publish a more detailed analysis of the estimates ("GDP and
the Economy").
Sources of Revision to Real GDP
Real GDP increased 2.0 percent (annual rate) in the second quarter of 2019, the same as in the “second”
estimate. The estimate reflected downward revisions to consumer spending and nonresidential
investment that were primarily offset by upward revisions to state and local government spending and
exports, and a downward revision to imports.
•
The downward revision to consumer spending reflected downward revisions to goods and
services. The largest contributor to the revision in goods was food and beverages purchased for
off-premises consumption based on Census Bureau Monthly Retail Sales Report data. The
largest contributor to the revision in services was “other services,” notably personal care and
clothing services, based on updated second-quarter Census Quarterly Services Report data.
•
The downward revision to nonresidential investment was primarily to structures, notably
manufacturing structures. The revisions primarily reflected updated Census construction
spending data.
•
The upward revision to state and local government spending was to structures reflecting
updated Census construction spending data.
•
The revisions to exports and imports reflected updated statistics from BEA’s International
Transactions Accounts (ITAs).
Real final sales to private domestic purchasers, which measures private demand in the domestic
economy and is derived as the sum of consumer spending and private fixed investment, increased 3.3
percent in the second quarter, a downward revision of 0.2 percentage point.
Prices
BEA's featured measure of inflation in the U.S. economy, the price index for gross domestic purchases,
increased 2.2 percent in the second quarter, the same as in the second estimate.
The price index for personal consumption expenditures (PCE) increased 2.4 percent, an upward revision
of 0.1 percentage point from the second estimate. Excluding food and energy prices, the PCE price index
increased 1.9 percent, an upward revision of 0.2 percentage point.
Gross Domestic Income and Corporate Profits
Real gross domestic income (GDI), which measures output of the economy as the incomes earned and
costs incurred in the production of goods and services (as measured by GDP), increased 1.8 percent in
the second quarter, a downward revision of 0.3 percentage point from the previous estimate. The
downward revision to real GDI primarily reflected a downward revision to corporate profits.
Profits from current production increased $75.8 billion, or 1.3 percent (quarterly rate), in the second
quarter, a downward revision of $29.9 billion. Domestic profits of financial corporations increased $2.5
billion, domestic profits of nonfinancial corporations increased $34.7 billion, and rest-of-the-world
profits increased $38.7 billion.
•
Within corporate profits, rest-of-the-world profits were revised down reflecting updated data
from the ITAs. Domestic industries’ profits were also revised down primarily reflecting updated
Census Quarterly Financial Report data.
BEA’s profits measure that is conceptually most similar to S&P 500 profits—national after-tax profits
without inventory valuation and capital consumption adjustments—increased $59.7 billion in the
second quarter, a downward revision of $26.3 billion. Second-quarter national after-tax profits (shown
in line 11 of table 9 of the GDP news release) increased 0.3 percent from the same quarter one year ago.
Erich H. Strassner
Associate Director, National Economic Accounts
Bureau of Economic Analysis
(301) 278-9612
-2-
@FedFRASER