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Value of U.S. Liabilities Increased More Than U.S. Assets in Fourth Quarter

The U.S. net international investment position was -$6,915.3 billion (preliminary) at the end of the fourth quarter of 2014 as the value of U.S. liabilities exceeded the value of U.S. assets. At the end of the third quarter, the net position was -$6,129.4 billion (revised).

march31 release

  • The $785.8 billion decrease in the net position reflected an $861.9 billion increase in the value of U.S. liabilities that exceeded a $76.1 billion increase in the value of U.S. assets.
  • The decrease in the net position reflected 1) the depreciation of major foreign currencies against the U.S. dollar that lowered the value of most U.S. assets and 2) the increase in U.S. equity prices that increased at a higher rate than foreign equity prices.
  • The U.S. net international investment position decreased 12.8 percent in the further quarter, compared with a decrease of 11.9 percent in the third quarter and an average quarterly decrease of 6.5 percent from the first quarter of 2011 through the second quarter of 2014.
  • U.S. assets were $24,693.2 billion at the end of the fourth quarter compared with $24,617.2 billion at the end of the third quarter.
  • U.S. liabilities were $31,608.5 billion at the end of the fourth quarter compared with $30, 746.6 billion at the end of the third quarter.

For more, see the full report.

Personal Savings Rate Rises in February

Personal income rose 0.4 percent in February, the same increase as in January. Wages and salaries, the largest component March30 Chartof personal income, rose 0.3 percent in February after rising 0.6 percent in January.

Current-dollar disposable personal income (DPI), after-tax income, rose 0.4 percent in February after rising 0.5 percent in January.

Real DPI, income adjusted for taxes and inflation, increased 0.2 percent in February after increasing 0.9 percent in January.

Real consumer spending (PCE), spending adjusted for price changes, decreased 0.1 percent in February after increasing 0.2 percent in January. Spending on durable goods decreased 1.1 percent in February after increasing 0.7 percent in January.

PCE prices increased 0.2 percent in February after decreasing 0.4 percent in January. Excluding food and energy, PCE prices increased 0.1 percent in February, the same increase as in January.

Personal saving rate
Personal saving as a percent of DPI was 5.8 percent in February and 5.5 percent in January.

Real Disposable Personal Income March 30

For more, see the full report.

GDP Increases in Fourth Quarter

Real gross domestic product (GDP) increased 2.2 percent in the fourth quarter of 2014, according to the “third” estimate released by the Bureau of Economic Analysis. The growth rate was the same in the “second” estimate released in February. In the third quarter, real GDP increased 5.0 percent.

Fourth-quarter GDP highlightsQ2Q March27
Consumer spending more than accounted for the increase in GDP, rising 4.4 percent, compared with 3.2 percent in the third quarter. Consumer spending on both goods and services increased in the fourth quarter.

Other contributors to growth:

  • Business investment increased, notably in intellectual property products.
  • Exports of goods and services increased; foods, feeds, and beverages was the largest contributor.

Offsetting the contributions to growth:

  • Imports of goods and services increased, notably of consumer goods (except food and autos) as well as petroleum and   products.
  • Federal government spending on national defense declined.

Fourth-quarter revisions
While the third estimate of real GDP growth was the same as the second estimate, several components were revised. Exports of services were revised up, mainly in travel. Consumer spending was also revised up, notably in health care. Inventory investment was revised down.

For more information, see the technical note.

Fourth-quarter corporate profitsQ2Q Corporate Profits March27
Profits fell 1.4 percent at a quarterly rate, after rising 3.1 percent in the third quarter.

Profits of nonfinancial corporations rose 1.4 percent, profits of financial corporations fell 2.7 percent, and profits from the rest of the world fell 8.8 percent.

Annual corporate profits
During 2014, corporate profits fell 0.8 percent, after rising 4.2 percent during 2013.

Profits of nonfinancial corporations rose 2.8 percent, profits of financial corporations fell 8.4 percent, and profits from the rest of the world fell 2.2 percent.

For more, see the full report.