Three months ago feels like a very long time.
However, the latest and revised data GDP It was released on Thursday (March 28). Bureau of Economic Analysis Here’s a closer look at Q4 and some hints about what’s to come in the coming months.
The headline figure shows real GDP rose 3.4% in the fourth quarter, which was revised upwards by 0.2% from initial expectations for the same period. The new revised figures still represent a noticeable slowdown from the 4.9% growth seen in the third quarter.
The bureau said in a statement on Thursday that supplementary data showed real-term final sales rose 3.3% for the quarter, 0.4% higher than initially expected, with the upward revision tied to higher consumer spending and private investment. He said he is doing so. The price index remained unchanged from the previous data, increasing by 1.9%, and the personal consumption expenditure (PCE) price index remained unchanged, increasing by 1.8%.
Real consumer spending for the quarter was 0.2% higher than consensus expectations, showing that American households are resilient, at least when it comes to handing over money at the register.
Revision of disposable income
“Personal disposable income increased by $190.4 billion (3.8%) in the fourth quarter, a downward revision of $12.1 billion from the previous estimate,” the bureau announced. “Real disposable personal income increased by 2%, with a downward revision of 0.2%.”
Real disposable income is adjusted for inflation and shows how much money consumers have left in the tank to continue spending, investing, or saving, so to speak.
We are already nearing the end of the first quarter, with the latest February data on core PCE and personal spending expected to be released on Friday (March 29). Each data point, month by month, quarter by quarter, ultimately tells a story. Even with a slight uptick in the fourth quarter, the economic slowdown warrants attention. At the household/consumer level, real disposable income may be increasing, but at an erratic pace.
What’s next?
The impact could be measured in current spending intentions, especially against the backdrop of consumer debt being three times more than disposable income, as PYMNTS Intelligence reported late last year.
another data consumer psychology The Expectations Index says: conference board The index, which is based on consumers’ short-term outlook on income, business and labor market conditions, fell to 73.8 from 76.3 in February.
“An Expectations Index below 80 often signals an upcoming recession,” the board added.
The Board also assessed consumer spending prospects. Fewer respondents said they would consider spending in the short term in 16 categories ranging from cars to pet care to travel.
Many people said they would spend the same amount over the next six months. He found that 30% of consumers said they expected to spend less on travel over the next six months. Nearly 18% said the same about spending on beauty and personal care items and services. 26.2% said they would spend less at restaurants.
