BEA released its preliminary GDP numbers for 2005 and the 4th quarter of 2005. [Note: BEA releases an “advanced estimate” at the end of a quarter, then a revised “preliminary” figure a month later, and then a “final” number a month after that.]
The GDP growth rate for the 4th quarter was 1.6% — slightly better than last month’s estimated 1.1%. According to BEA the reason for the revisions are as follows:
The preliminary estimate of the fourth-quarter increase in real GDP is 0.5 percentage point, or $14.1 billion, higher than the advance estimate issued last month. The upward revision to the percentage change in real GDP primarily reflected upward revisions to exports, to federal government spending, to equipment and software, and to change in private inventories that were partly offset by an upward revision to imports.
The preliminary real GDP increased 3.5% 2005 (the same as last month’s advance estimate.) Real GDP grew by 4.2% in 2004.
As I discussed in my earlier concerns about what happened to growth, the advanced estimates showed a slow down in services trade. The revision show a continued weakness in services trade. The same is partly true for trade in intangibles. My analysis of the intangibles trade surplus shows an increase in our intangibles surplus in October of $57 million, a decline of $1 million in November, and an increase of only $22 million in December.
Thus, the weakness in our trade in intangibles continues.