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U.S. Q1 GDP revised up more than expected, consumer spending misses

Published 06/28/2016, 08:34 AM
© Reuters.  U.S. Q1 GDP beats consensus, but consumer spending deteriorates unexpectedly
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Investing.com - Growth of the U.S. economy in the first quarter was revised up more than forecast, although consumer spending was unexpectedly revised down, according to official data released Tuesday.

The third estimate of first quarter growth domestic product (GDP) showed growth of 1.1%, revised up from the initial reading of a 0.8% rise.

Analysts had expected growth to settle at 1.0%.

Real consumer spending for the first three months of the year was revised down to 1.5%, from the prior reading of 1.9%.

Economists had forecast an upward revision to 2.0%

On the inflation front, personal consumption expenditure (PCE) prices were revised down to 0.2%, from the prior 0.3%. Analysts had expected no change.

Core PCE prices were also lowered to 2.0% from the previous 2.1% increase. Consensus had not expected a revision.

The GDP price index was also revised down to an increase of 0.4%, lower than the prior reading of 0.6%. Analysts had expected no change to the previous reading.

Growth in corporate profits was unexpectedly revised up to 2.2%, from the prior 0.6% rise. Consensus had forecast there to be no revision.

Immediately after the report, the dollar remained broadly lower. EUR/USD was trading at 1.1083 from around 1.1079 ahead of the publication; GBP/USD was at 1.3396 from 1.3391 earlier; while USD/JPY was at 102.33 from 102.37 earlier.

The US dollar index, which tracks the greenback against a basket of six major rivals, was at 96.02, compared to 96.07 ahead of the report.

Meanwhile, U.S. stock futures pointed to a higher open. The Dow futures gained 207 points, or 1.22%, the S&P 500 futures advanced 24 points, or 1.20%, while the Nasdaq 100 futures traded up 51 points, or 1.21%.

Elsewhere, in the commodities market, gold futures traded at $1,316.70 a troy ounce, compared to $1,316.00 ahead of the data, while crude oil traded at $47.65 a barrel from $47.59 earlier.

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