Real GDP increased at a seasonally adjusted annual rate of 1.3% during the first quarter of 2023, according to the Bureau of Economic Analysis’s. Real GDP increased 2.6% in the fourth quarter of 2022.
The increase in real GDP reflected increases in consumer spending, exports, federal government spending, state and local government spending, and nonresidential fixed investment that were partly offset by decreases in private inventory investment and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.
Consumption added 2.52 percentage points (pp) to growth; this follows a 0.7 pp addition during the fourth quarter of 2022. The increase in PCE was driven by services (led by durable goods and vehicles and parts) offset by decreases in clothing and footwear. Inventories decreased, subtracting 2.10 pp to GDP. Residential investment subtracted a total of 0.22 pp from GDP.
Business investment added 0.18 pp from GDP. Investment in intellectual property added 0.28 pp to GDP while residential subtracted 0.22 pp.
Government spending increased, adding 0.89 pp to GDP. Federal and state-local government added 0.48 and 0.41 pp to GDP, respectively.