Q3 GDP (Final): Slight Downward Revision

GDP was REVISED LOWER by 0.1 percentage points to 2.0% in this third estimate for 2015 Q3, compared with market expectations for a downward revision to 1.9%. Economic activity is now 2.1% above its year ago level. In final sales categories, residential investment, fixed investment, imports, government purchases were revised higher while net exports, and exports were revised lower. Consumption was little changed. As a result of all of these changes, real final sales were unchanged at 2.7% while real domestic demand was unchanged at 2.9%. The GDP Price Index was UNCHANGED at 1.3%, in line with market expectations. Economy-wide prices are now 0.9% ABOVE year ago levels. Economy-wide inflation hit a cyclical peak of 3.4%in 2006 Q2 and reached a cyclical nadir of 0.2% in 2009 Q3. Bottom Line: Economic activity was revised slightly lower to 2% in 2015 Q3. Because this revision was largely due to new September data, this suggests that the pace of growth late in the quarter slowed. Economic activity is now 2.1% above its year ago level and 9.5% above its previous peak level in 2007 Q4. 2015 Q4 ends next week, the data released so far for October, November and early December suggest that 2015 Q4 economic activity grew at a similar pace as in Q3; many early estimates are between 2.0% to 2.5%.