The Bureau of Economic Analysis (BEA) second estimate of real GDP growth for the first quarter of 2013 is 2.4%, revised down from 2.5% in the advance estimate. Stronger personal consumption expenditures (PCE) and less drag from weaker imports were offset by weaker growth in inventory investment, exports and state and local government spending than in the initial estimates. Real GDP growth was 0.4% in the fourth quarter of 2012.
We still expect growth weakened in the second quarter and will continue to weaken in the third before turning up in the fourth quarter of the year. Residential fixed investment (RFI), home building’s contribution to GDP, has rebounded beginning in late 2011 and is expected to continue to make positive contributions to growth despite the weakening broader economy.