3rd quarter GDP revised upward

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 3.9 percent in the third quarter of 2004, according to preliminary estimates released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 3.3 percent.

The GDP estimates released today are based on more complete source data than were available for the advance estimates issued last month. In the advance estimates, the increase in real GDP was 3.7percent.

The major contributors to the increase in real GDP in the third quarter were personal consumption expenditures (PCE), equipment and software, exports, government spending, and residential fixed investment. The contributions of these components were partly offset by a negative contribution from private inventory investment. Imports, which are a subtraction in the calculation of GDP, increased.

The acceleration in real GDP growth in the third quarter primarily reflected an acceleration in PCE and a deceleration in imports that were partly offset by a downturn in private inventory investment and a deceleration in residential fixed investment.

Final sales of computers contributed 0.18 percentage point to the third-quarter change in real GDP after contributing less than 0.01 percentage point to the second-quarter change. Motor vehicle output contributed 0.33 point to the third quarter change in real GDP after subtracting 0.58 percentage point from the second-quarter change.