We got a GDP beat dealt into trader's cards this morning.
The U.S. economy grew at a +2.5% annual rate in the second quarter
of 2013 instead of the +1.7% number earlier estimates suggested.
The economy's forecasters thought GDP would be revised up +2.2%.
This amounts to a 'beat'.
The quarter's revised growth rate is now more than double the pace
clocked in the prior three months. This increase was due to a
stronger trade picture. Trade numbers showed a greater strength in
U.S. exports, and a slower increase in U.S. imports.
Companies also restocked inventories faster than previously
believed. And U.S. businesses raised structures investment more
than previously thought.
Consumer spending --70% of the U.S. economy-- remained unchanged.
It showed +1.8% growth. Anything around +2% is 'muddle-through'
data here. Disposable personal income climbed +3.2% instead of
+3.4% as originally reported. More evidence of consistent support
for consumer demand.
The government's spending fell -0.9%, instead of- 0.4%, so the
sequester effects went up, and still GDP growth in the second
In another positive sign, revised data showed demand for
U.S.-produced goods and services rose at a +1.9% pace in Q2 instead
of a +1.3% rate previously estimated. This increase also reflected
higher U.S. exports.
In this Q2 report, housing accounted for nearly a fifth of the U.S.
economy's growth. However, other more recent data suggested housing
investment has fallen off.
This upwardly revised GDP data could make the Fed more confident in
their plan to reduce their monthly bond purchases.
My RTI Question: Does the size and timing of the Fed's
taper change due to this report?
SPDR-DJ IND AVG (DIA): ETF Research Reports
SPDR-GOLD TRUST (GLD): ETF Research Reports
SPDR-SP 500 TR (SPY): ETF Research Reports
To read this article on Zacks.com click here.