WASHINGTON (Reuters) - U.S. economic growth for the second quarter is likely to be revised higher after data on Friday suggested a bit more consumer spending than previously estimated.
The findings of the Commerce Department's quarterly services survey, or QSS, come on the heels of data this week showing a less steep decline in construction spending in June than previously reported.
Before the QSS data, economists had expected that GDP growth for the April-June quarter would be raised to an annualized rate of 4.3 percent from the 4.2 percent pace that the government reported last week in its second GDP estimate.
Based on the QSS data, JPMorgan (NYSE:JPM) and Macroeconomic Advisers estimated another one-tenth of a percentage point would be added to the GDP estimate. That means second-quarter GDP growth could be lifted to a 4.4 percent rate when the government publishes its second revision later this month.
"We think that the QSS data imply a small upward revision to 2Q consumption and a very small downward revision to intellectual property products investment," said Daniel Silver, an economist at JPMorgan in New York.
In its second GDP estimate last week, the government lowered second-quarter consumer spending growth to a 3.8 percent pace from the 4.0 percent rate when then government published its advance GDP growth estimate back in July.
Economists said Friday's QSS data showed more spending at nonprofit hospitals and other sectors.