In the first quarter of 2021, it has grown at a rate of 6.4 percent annually. The upward revision in nonresidential fixed investment, private inventory investment and exports was offset by an upward revision in imports, driven by an upward revision in the gross domestic product (GDP), according to the latest estimate released Thursday by the Bureau of Economic Analysis.
There is a subtraction in the calculation. As the Xinhua News Agency reported, imports increased, the bureau said, adding to the growth in real GDP in the first quarter from personal consumption expenditure (PCE), non-residential fixed investment, federal government spending, residential fixed investment, and state and local Reflecting increases in government spending, were partially offset by a decrease in private inventory investment and exports.
The bureau said the first quarter GDP growth was driven by continued economic recovery, reopening of establishments and the government’s response to the COVID-19 pandemic. In its two-day policy meeting last week, the US Federal Reserve decided to keep its benchmark interest rates unchanged at a record-low of zero.
According to the latest summary of the Fed’s economic projections, the average forecast among Fed officials called for 7.0 percent GDP growth by the end of the year, up 0.5 percent from March’s estimate.
Meanwhile, inflation is expected to climb to 3.4 percent by the end of the year, up 1 percent from the March estimate. The core PCE price index, the Fed’s preferred inflation measure, is expected to rise to 3 percent by the end of the year, up 0.8 percentage points from the March projection and well above the Fed’s long-term target of 2 percent.