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THURSDAY November 29, 2007 GDP ACCELERATES IN THE THIRD QUARTER Corporate Profits Grow The economy grew at an annual rate of 4.9 percent in the third quarter, compared with 3.8 percent in the second, according to the “preliminary” estimates released by the Bureau of Economic Analysis. The third-quarter growth rate was revised up from the “advance” estimate of 3.9 percent. Gross Domestic Product (GDP) The acceleration in GDP growth reflected accelerations in exports, consumer spending, and inventory investment. In contrast, import growth resumed after a decline in the second quarter, and housing investment declined more than in the second quarter. Revision The upward revision to GDP growth resulted from newly available data that show greater increases in inventory investment and net exports. Quarter-to-Quarter Growth in Real GDP 6 Percent 4 2 0 IV I 2003 II III 2004 IV I II III 2005 IV I II III 2006 IV I II III 2007 Real GDP growth is measured at seasonally adjusted annual rates. Corporate Profits Third-quarter corporate profits increased 1.9 percent from the same quarter a year ago. Net profits earned abroad increased 35 percent, while domestic profits declined 4 percent. Year-over-Year Growth in Corporate Profits 30 25 Percent 20 15 10 5 0 IV 2003 I II III 2004 IV I II III 2005 IV I II III 2006 IV I II III 2007 Corporate profits growth is measured as the percent change from the same quarter one year ago. 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 “final” estimate of third-quarter GDP on December 20, 2007. A revised estimate of corporate profits will also be released. Contact: Ralph Stewart 202–606–2649 Bureau of Economic Analysis, U.S. Department of Commerce