Real gross domestic product (GDP) declined at an annual rate of 1.4% in the first quarter of 2022

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April 28, 2022 – Real gross domestic product (GDP) fell at an annual rate of 1.4% in the first quarter of 2022 (Table 1), according to the “advance” estimate published by the Bureau of Economic Analysis. In the fourth quarter, real GDP grew by 6.9%.

The GDP estimate released today is based on source data that is either incomplete or subject to further revision by the source agency (see “Base data for pre-estimate” on page 3). The “second” estimate for the first quarter, based on more complete data, will be published on May 26, 2022

The decrease in Real GDP reflected declines in private investment in inventory, exports, federal government spending, and state and local government spending, while imports, which are a subtraction in the GDP calculation, rose. Personal consumption expenditure (PCE), non-residential fixed investment and residential fixed investment increased (Table 2).

Impact of COVID-19 on the GDP estimate for the first quarter of 2022

In the first quarter, an increase in COVID-19 cases linked to the Omicron variant resulted in continued restrictions and disruptions to facility operations in some parts of the country. Government assistance payments in the form of repayable loans to businesses, grants to state and local governments, and social benefits to households have all declined as the provisions of several federal programs have expired or been reduced. The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the first quarter, as the impacts are usually embedded in the source data and cannot be separately identified. For more information, see the Technical Note and the BEA’s Federal Stimulus Programs and Statistics.

The decline in private investment in inventory was led by declines in wholesale trade (mainly motor vehicles) and retail trade (notably “other” retailers and motor vehicle dealers). Within exports, broad-based declines in non-durable goods were partly offset by an increase in “other” business services (mainly financial services). The decrease in federal government spending primarily reflects lower defense spending on intermediate goods and services. The increase in imports was driven by the increase in durable goods (notably non-food and non-automotive consumer goods).

The increase in PCE reflects an increase in services (led by health care) which was partially offset by a decrease in goods. Within goods, a decline in non-durable goods (led by gasoline and other energy goods) was partly offset by an increase in durable goods (led by motor vehicles and parts). The increase in non-residential fixed investment reflected increases in equipment and intellectual property products.

GDP in current dollars rose 6.5% year on year, or $379.9 billion, in the first quarter to $24.38 trillion. In the fourth quarter, GDP increased by 14.5%, or $800.5 billion (Table 1 and Table 3).

The gross domestic purchases price index increased by 7.8% in the first quarter, compared to an increase of 7.0% in the fourth quarter (Table 4). The PCE Price Index increased by 7.0%, compared to an increase of 6.4%. Excluding food and energy prices, the PCE price index rose 5.2% vs. a 5.0% rise.

Personal income

Personal income in current dollars increased by $268.0 billion in the first quarter, compared to an increase of $123.9 billion in the fourth quarter. The increase mainly reflects an increase in compensation which was partly offset by a decrease in government social benefits (Table 8). In the first quarter, government assistance payments in the form of social benefits to households declined as the provisions of several federal programs expired or continued to decline.

Personal disposable income rose $216.6 billion, or 4.8%, in the first quarter, compared to an increase of $20.1 billion, or 0.4%, in the fourth quarter. Real personal disposable income decreased by 2.0%, compared to a decrease of 5.6%.

Personal savings was $1.21 trillion in the first quarter, compared to $1.39 trillion in the fourth quarter. The personal savings rate— personal savings as a percentage of personal disposable income — was 6.6% in the first quarter, compared to 7.7% in the fourth quarter.

Source data for the preliminary estimate
Information on the source data and key assumptions used in the preliminary estimate are provided in a technical note published with the press release on the BEA website. A detailed “Key Source Data and Assumptions” file is also published for each release. For more information on GDP updates, see the “Additional Information” section that follows.
Source: BEA

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