Economy Watch: 3Q GDP Revised Upward

The Bureau of Economic Analysis revised its estimate for real U.S. GDP growth for the third quarter, with increased economic growth in nonresidential fixed investment, including commercial real estate.

Outgoing Federal Reserve Chair Janet Yellen (Photo by Paul Morigi)
Outgoing Federal Reserve Chair Janet Yellen (Photo by Paul Morigi)

Real U.S. gross domestic product increased at an annual rate of 3.3 percent during the third quarter of 2017, according to the second estimate by the Bureau of Economic Analysis, which was released Nov. 29. In the first or advance estimate, the increase in real GDP was calculated at 3 percent. During the second quarter, real GDP increased 3.1 percent.

The latest GDP estimate is based on more complete source data than were available for the last month’s estimate. Even so, the general picture of economic growth is the same. Nonresidential fixed investment (including commercial real estate), state and local government spending, and private inventory investment were revised upward compared with the first estimate.

Also on Nov. 29, outgoing Federal Reserve Chair Janet Yellen told the Joint Economic Committee of Congress that the U.S. economy gathered steam this year, a condition that will warrant more interest rate increases. “The economic expansion is increasingly broad based across sectors, as well as across much of the global economy,” Yellen said.

She also warned Congress, when asked, about the U.S. public debt. “I would simply say that I am very worried about the sustainability of the U.S. debt trajectory,” Yellen said. “Our current debt-to-GDP ratio of about 75 percent is not frightening but it’s also not low.”It’s the type of thing that should keep people awake at night.”