It's The Economy Stupid: Economy Grows at 3% Annual Rate in 4Q

Today’s economic numbers beat both the previous periods numbers and economist’s forecasts for this period’s numbers.  That’s a good thing.

 

Bernanke will give his semi-annual economic forecast to the House Financial Services Committee at 10 a.m. today.  Who knows is that’s a good thing.

 

Economic Event	Period	Economic Survey	Actual Reported	Original Prior	Revised Prior
MBA Mortgage Applications	FEB 24	-	-0.3%	-4.5%
GDP QoQ (Annualized)	4Q S	2.8%	3.0%	2.8%
GDP Personal Consumption	4Q S	1.9%	2.1%	2.0%
GDP Price Index	4Q S	0.4%	0.9%	0.4%
GDP Core Personal Cons QoQ	4Q S	1.1%	1.3%	1.1%

 

The U.S. economy expanded more than forecast in the fourth quarter as companies rebuilt inventories in anticipation of growing demand.

 

Gross domestic product climbed at a revised 3 percent annual rate, the most since the second quarter of 2010. Economists surveyed by Bloomberg News called for no change from the

previously reported 2.8 percent gain

 

Income gains in the second half of 2011 were stronger than previously reported as employment growth accelerated, which may set the stage for a pickup in consumer spending that accounts for about 70 percent of the economy.

 

Growth forecasts from the 82 economists surveyed ranged from 2.2 percent to 3.2 percent. The world’s largest economy expanded at a 1.8 percent rate in the prior three months.

 

Consumer spending grew at a 2.1 percent annual rate, little changed from the 2 percent initial estimate and reflecting a pickup in demand for services.

 

In the prior three months, incomes climbed 0.7 percent compared with a 1.9 percent slump that was initially reported. Wages and salaries from July through September rose $107.2

billion, up from the $24.8 billion gain initially reported.    This helped boost the savings rate to 4.5 percent from a previously reported 3.7 percent. In the third quarter, the rate

was 4.6 percent.

 

Inventories contributed the largest boost to growth in the final three months of 2011. Stockpiles added 1.88 percentage points to GDP, compared with a previously estimated 1.9 points.

GDP minus inventories, or final sales, rose 1.1 percent.

 

Factory output rose 0.7 percent in January after a 1.5 percent surge in December, marking the best two-month performance since July-August 2009, Fed data showed earlier this month.

 

 

 

 

John Broussard

Assistant State Treasurer

Chief Investment Officer

State of Louisiana

Department of the Treasury

Ph:  225-342-0013

Fx:  225-342-9721

Email:  jbroussard@treasusry.state.la.us

Street Address:

445 North Blvd, 7^th Floor

Baton Rouge, LA 70802

Mailing Address:

P.O. Box 44154 Capitol Station

Baton Rouge, LA 70804-4154

Physical Location:

One City Plaza, 7th Floor

Corner of North Blvd & 4th Street

Exit 1B I-110 Convention Street,

Turn Left to get to North Blvd,

Turn Right on North Blvd