US Real GDP Declines at an Annual Rate of 0.2% in Q1, BEA Reports in Its “Second” Estimate

On Thursday, the Bureau of Economic Analysis (BEA) released its “second” estimate for Q1 real gross domestic product (GDP). Real GDP declined at an annual rate of 0.2% in Q1, following an increase of 2.4% in 2024Q4.

Compared to Q4, the downturn in real GDP in Q1 primarily reflected an upturn in imports, a deceleration in consumer spending, and a downturn in government spending that were partly offset by upturns in investment and exports.

Real GDP was revised up 0.1 percentage point from the “advance” estimate, reflecting an upward revision to investment that was partly offset by a downward revision to consumer spending.

The price index for gross domestic purchases increased 3.3% in Q1, revised down 0.1 percentage point from the previous estimate. The personal consumption expenditures (PCE) price index increased 3.6%, the same as previously estimated. Excluding food and energy prices, the PCE price index increased 3.4%, revised down 0.1 percentage point from the previous estimate.

Real final sales to private domestic purchasers—the sum of consumer spending and gross private fixed investment—increased 2.5% in Q1, revised down 0.5 percentage point from the previous estimate.

The “second” estimate is based on source data that are incomplete or subject to further revision. The “third” estimate, based on more complete data, and will be released on June 26.