December 2013 Economic Indicators

Melanie Garza - Director of Operations

Revised GDP Exceeds Expectations

The U.S. economy grew more rapidly than originally expected in the third quarter. The Commerce Department adjusted its original estimate up nearly 1% from 2.8% to 3.6%, on the December 5, 2013 release. In the second quarter real GDP climbed a modest 2.5%. However, this is the highest gain since first quarter 2012.

Despite the increase, economists say high inventories were the driving factor for the reported growth. Private business inventory investment grew $116.5 billion, accounting for 1.68% points of the GDP growth.

Economists are predicting continued growth; however, problems in Washington may slow down the acceleration.

In removing private inventories, GDP grew a mere 1.9% reflecting a subtle gain. Private business spending continued to grow, but at a slower rate. Fixed investments grew 3.5% down from 4.7%; structures climbed 13.8% while second quarter results were 17.6% and equipment remained unchanged at 3.3%.

Real personal consumption expenditures increased 1.4%, down from 1.8% in the second quarter. Demand for durable goods continues to rise, as it jumped 7.7%, compared to 6.8% the previous quarter.

State and local government spending continues to inch up at 1.7%; the first time gain in two consecutive quarters in 4 years.

Gross Domestic Product

Consumer Confidence Hits Low

The index climbed to its highest level in nearly six years in May, at 76.2, and peaked in June at 82.1.

In October, Consumer Confidence plummeted to 72.2 as a result of the government financial crisis and ultimate shutdown. Lynn Franco, Director of Economic Indicators said, “All in all, with such uncertainty prevailing, this could be a challenging holiday season for retailers.”

Consumer Confidence

Questions? Please contact Melanie Garza at