GDP (Q2 3rd Est. & Annual Revision) & Durable Goods (Aug)

At first glance the annual revision to the national accounts doesn’t appear to have had much of an impact – with second-quarter GDP growth left unchanged at 3.0% and core PCE inflation unchanged at 2.8%. But below the surface, the revisions were all positive. We had feared that, given the gap between GDP and GDI, the former would be revised lower. As it turns out, however, the level of real GDP was revised up by 1.3%, with the gap partly closed by an even bigger 3.8% upward revision to the level of GDI. The additional GDI mostly comes from a 3.5% upward revision to real personal disposable income, which helps to explain why consumption has remained so resilient in recent years. As a result, the second-quarter saving rate was revised up from 3.3% to a much healthier looking 5.2%.