3Q2010 Gross Domestic Product: Advance Estimate

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The Bureau of Economic Analysis reported that the rate of growth in real U.S. gross domestic product (GDP) accelerated slightly in 3Q2010. The U.S. economy expanded at a 2 percent annual rate, up from 1.7 percent in the previous quarter.

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The increase in real GDP in the third quarter primarily reflected positive contributions from personal consumption expenditures (PCE), private inventory investment and nonresidential fixed investment (both part of private domestic investment or “PDI”), federal government spending, and exports. Those positive contributions were partly offset by negative contribution from residential fixed investment (another PDI component) and imports.

“We need to do better than this to get a real recovery in the labor market,” said Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York. “The report leaves everything in place for more asset purchases by the Fed.”