US Advance GDP

Gross domestic product is the broadest measure of what an economy produces. The Bureau of Economic Analysis publishes three estimates for each quarter, and the advance release, arriving roughly a month after the quarter closes, is the first. It is built mostly from the expenditure side: consumer spending, business investment, housing, government purchases, inventories and net exports, each assembled from dozens of source datasets, some of which are still incomplete at the time.

One convention sets the US apart. Quarterly growth is expressed at an annualised rate, meaning the quarter-on-quarter change is compounded as if it continued for a full year, so a US figure looks roughly four times larger than the same growth reported by most other countries. The release also carries a price index for GDP and the core PCE deflator for the quarter, which can matter as much as the growth number for rate expectations.

Markets tend to react less to the headline than its fame suggests, since tracking models such as the Atlanta Fed's GDPNow give a running estimate beforehand. Surprises often come from volatile inventories or trade, which analysts tend to strip out to look at final sales to private domestic purchasers as a cleaner read of demand.

The second and third estimates follow at monthly intervals, and annual updates can rewrite several years of history. Gross domestic income, the income-side counterpart, is published with the later estimates, and the gap between the two measures is itself watched.