Your Montana Public Radio
Wed June 26, 2013
Revised GDP Numbers Weaker Than Projected
The nation's gross domestic product, the output of goods and services produced within the U.S., grew at a rate of 1.8 percent in the first quarter of this year, according to the Commerce Department's Bureau of Economic Analysis. That's a downward revision from the 2.4 percent rate previously reported.
USA Today points out that "the biggest change was a cut in the government's estimate of consumer spending growth, which dropped to 2.6% from 3.4% growth."
People spent less on services such as personal care, travel and legal services, according to Bloomberg.
Consumers took a big hit in the pocketbook as of Jan. 1: That's when a 2 percent increase in the payroll tax took effect, and people appear to have spent less after that. As CNN Money notes, consumer spending makes up about two-thirds of the economic activity in the GDP, so the figure is closely watched.
The Commerce Department regularly revises its GDP figures, and the first-quarter revision released today is the third one this year.