The Bureau of Economic Analysis (BEA) released its advance estimate of growth in the inflation-adjusted (“real”) gross domestic product (GDP) for the 2^nd quarter of 2011 (View Report here). 

According to the advance estimate, annualized GDP growth in the 2^nd quarter was 1.3%.  The Blue Chip Consensus forecast had been for growth of 2.0% in the 2^nd quarter.  Growth in the 1^st quarter of 2011 was revised downwards to 0.4%, from a previously reported rate of 1.9%.  Growth in the 4^th quarter of 2010 was 2.3%, also reflecting a downward revision from a previously reported 3.1%.   The BEA will release its second estimate for 2^nd quarter GDP growth on August 26^th. 

 Highlights:

The 1.3% rate of growth primarily reflected positive contributions exports, nonresidential fixed investment, private inventory investment, and federal government spending.  These positive contributions were partly offset by negative contributions from imports and state and local government spending.

The acceleration in GDP growth, from a rate of 0.4% in the 1^st quarter, was due to a deceleration in imports (which are a subtraction from GDP), an upturn federal government spending, and acceleration in nonresidential fixed investment.  This upward momentum was partly offset by a sharp deceleration in personal consumption expenditures.