United States gross domestic product — the broadest measure of a nation’s overall economic health — grew at an annual rate of 2 percent in the first quarter of 2018, according to the third estimate from the Department of Commerce.
The first-quarter growth rate was further revised downward from 2.3 percent in Commerce’s advance estimate and 2.2 percent it its second estimate. The growth rate is also down from the 2.9 percent annual rate seen in the fourth quarter of 2017 and is the slowest since the first quarter of 2017.
Despite the downgrade, however, the Commerce Department’s Bureau of Economic Analysis (BEA) said the “general picture of economic growth remains the same.”
U.S. GDP grew at a 3.2 percent rate in the third quarter of 2017, 3.1 percent in the second quarter and 1.2 percent in the first quarter, meaning that real GDP increased 2.3 percent in 2017 compared with a 1.5 percent growth rate in 2016 and a 2.9 percent increase in 2015.
GDP is a calculation of the value of the goods and services produced by a nation’s economy minus the value of the goods and services used up in production.
BEA said the deceleration in GDP growth in the first quarter reflected decreases in personal consumption expenditures, exports and residential fixed investment, as well as state, local and federal government spending. Those factors were offset in part by an increase in nonresidential fixed investment, as well as a deceleration in imports, which are a subtraction in the calculation of GDP.
Real exports of goods and services grew 3.6 percent in the first quarter, according to BEA, compared with a 7 percent increase in the fourth quarter of 2017. Imports, meanwhile, grew just 3.2 percent, compared with a 14.1 percent jump the previous quarter.
Adding to the somewhat discouraging news for the U.S. economy, the most recent data from Commerce indicates new orders for durable goods slipped another 0.6 percent to $248.8 billion in May, following a revised 1 percent decline the previous month. The May decrease in durable goods orders was the third in the last five months and fifth in the last 12 months.
Commerce’s Census Bureau noted that transportation equipment, also down for the second consecutive month, drove the decline in durable goods orders, slipping 1 percent to $86.1 billion for the month. Excluding orders for transportation equipment, total durable goods orders were down 0.3 percent.
Shipments of manufactured durable goods fell for the first time in 10 months in May, slipping 0.1 percent to $246.9 billion, following an April in which shipments were “virtually unchanged,” according to Census.