Gross domestic product (GDP) in the United States grew at a 1.5 percent annual rate in the second quarter of 2012, according to data released Friday by the Commerce Department. The number was in line with economists’ projections.
The Commerce Department’s Bureau Economic Analysis (BEA) said both consumer and business spending fell compared to the first quarter of 2012. The unemployment rate improved in the second quarter, but consumers saved more, pushing the savings rate to 4 percent from 3.6 percent in Q1 2012.
Economists’ anticipated the GDP growth rate to fall between 1.3 and 1.7 percent, so the announcement Friday was as-expected.
The big news in the report was in the revisions. BEA revised first quarter 2012 GDP growth to 2 percent from an initial reading of 1.9 percent and significantly revised the fourth quarter 2011 growth rate to 4.1 percent from the 3 percent originally reported.
The revisions were part of a broad annual review by BEA. The agency noted that the recession itself wasn’t quite as deep as previously reported. The American economy contracted by 4.7 percent from the fourth quarter of 2007 to the second quarter of 2009, according to the revisions. Previously the economy was estimated to have shrunk by 5.1 percent. It was still the deepest recession since the Great Depression.
Likewise, the recovery immediately following the recession wasn’t as robust. In 2010, the economy grew 2.4 percent compared to the initial estimate of 3 percent. The growth rate for 2011 was largely unchanged at 1.8 percent. In the first two quarters of 2012, growth has averaged a 1.75 percent annual rate.