Bureau of Economic Analysis Reports in Its “Advance” Estimate That Real GDP in Q1 2022 Decreased at an Annual Rate of -1.4%

The Bureau of Economic Analysis (BEA) released today (4-28-22) its “advance” estimate for real gross domestic product (GDP) in Q1 of 2022. According to the report, GDP decreased at an annual rate of -1.4%, following an increase of 6.9% in Q4 of 2021.

The “advance” GDP estimate is based on source data that are incomplete and subject to further revision by the source agency. The “second” estimate for Q1, based on more complete data, is scheduled to be released on May 26, 2022.

The decrease in real GDP in Q1, reflects decreases in private inventory investment, exports, federal government spending, and state and local government spending, while imports, which are a subtraction in the calculation of GDP, increased. Personal consumption expenditures (PCE), nonresidential fixed investment, and residential fixed investment increased.

The BEA notes that in the first quarter, an increase in COVID-19 cases related to the Omicron variant resulted in continued restrictions and disruptions in the operations of establishments in some parts of the country. Government assistance payments in the form of forgivable loans to businesses, grants to state and local governments, and social benefits to households all decreased as provisions of several federal programs expired or tapered off.

The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the first quarter because the impacts are generally embedded in source data and cannot be separately identified.