I believe that I've remarked on this before, but there is simply no bigger economic measure than GDP. It's the Gross Domestic Product, the sum total of private domestic consumption plus gross private domestic investment plus government spending plus the current trade balance. It's the scorecard used to determine the health of the US economy, and it dominates everything else in its path because it is everything else in its path.
It comes out in an interesting fashion, as well. Today, we get the initial estimate. Next month around this time, we'll get the revised estimate. Then, in June, we'll get the final revision.
The Q4 2010 final figures were pretty much right in line with expectations. GDP increased at an annual rate of 3.1%, the GDP price index increased 2.1%, and the core GDP price index increased 1.1%. The Econoday-surveyed analysts are not feeling as optimistic about Q1 2011, though. They're calling for GDP to have increased 2.0%, and the GDP price index to have increased 2.2%. Are they right? Let's visit the Bureau of Economic Analysis to find out.
The Gross Domestic Product, 1st quarter 2011 (advance estimate) shows GDP growing at an annual rate of 1.8% (missing expectations). The price index increased 3.8%, with the core price index increasing 2.2%.
To quote the release: "The Bureau emphasized that the first-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency. The 'second' estimate for the first quarter, based on more complete data, will be released on May 26, 2011." So things could improve as more data comes in. But still.
The takeaway here? At least as far as initial estimates are concerned, inflation far outstripped economic growth in Q1.