US ECON: Q3 GDP Revised Down To 2.8% Gain From 3.5%

[girl gone mad]

This surprised me. Did not expect such a sharp downward revision..

http://www.forbes.com/feeds/afx/2009/11/24/afx7153539.html

Washington, November 24 - US GDP grew by 2.8% in the third quarter of 2009, a sharp downward revision from the 3.5% rise the Commerce Department first reported. The 0.7 percentage point lower reading reflected an upward revision to imports and downward revisions to personal consumption expenditures and to nonresidential fixed investment, which were partly offset by an upward revision to exports. Economists were expecting third quarter GDP to be revised down to 2.9%.

Imports rose by 20.8% in the third quarter, more than the 16.4% first estimated. Consequently, imports ate 2.53 percentage points from total GDP, more than a half a percentage point more than in the first estimate.

Consumer spending was sharply revised from a 3.4% rise to a 2.9% increase, adding .29 fewer percentage points to total GDP than first reported. Much of this revision was due to a downward revision to motor vehicle ouput.

Meanwhile, non-residential fixed investment fell 4.1%, much more than the 2.5% drop-off first reported. This factor subtracted .4 percentage points from total GDP, almost double what was first reported.

Partly offsetting these downward factors was an upward revision to exports, from a 14.7% rise to a 17.0% rise, now the largest quarterly increase since 2007. Exports contributed 1.71 percentage points to total GDP, .22 pp more than what was first reported.