Archive Page 4

Value of U.S. Assets Decreased More than U.S. Liabilities in Third Quarter 2015

The U.S. net international investment position was -$7,269.8 billion (preliminary) at the end of the third quarter of 2015 as the value of U.S. liabilities exceeded the value of U.S. assets. At the end of the second quarter, the net investment position was -$6,743.1 billion (revised).

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  • The $526.7 billion decrease in the net investment position reflected net other changes in position of -$514.9 billion and net financial transactions of -$11.8 billion. Other changes in position include price changes, exchange-rate changes, and other changes in volume and valuation.
  • U.S. assets decreased $1,233.3 billion and U.S. liabilities decreased $706.6 billion, mostly as a result of decreases in the value of portfolio and direct investment assets and liabilities.
  • U.S. assets excluding financial derivatives decreased $1,496.6 billion, reflecting other changes in position of -$1,419.3 billion and financial transactions of -$77.3 billion.
  • U.S. liabilities excluding financial derivatives decreased $961.8 billion, reflecting other changes in position of -$897.1 billion and financial transactions of -$64.7 billion.
  • The decrease in the net investment position reflected equity price decreases for U.S. assets and liabilities and the depreciation of foreign currencies against the U.S. dollar, as described in the news release.

For more information, read the full report.

Real PCE Increases in November

Personal income increased 0.3 percent in November after increasing 0.4 percent in October. Wages and salaries, Personal Income chart 1223the largest component of personal income, increased 0.5 percent in November after increasing 0.6 percent in October.

Current-dollar disposable personal income (DPI), after-tax income, increased 0.3 percent in November after increasing 0.4 percent in October.

Real DPI, income adjusted for taxes and inflation, increased 0.2 percent in November after increasing 0.3 percent in October.

Real consumer spending (PCE), spending adjusted for price changes, increased 0.3 percent in November after remaining flat in October.

PCE prices remained flat in November after increasing 0.1 percent in October. Excluding food and energy, PCE prices increased 0.1 percent in November after remaining flat in October.

Personal saving rate
Personal saving as a percent of DPI was 5.5 percent in November and 5.6 percent in October.

Real DPI 1223

GDP Increases in Third Quarter

Real gross domestic product (GDP) increased 2.0 percent in the third quarter of 2015, according to the “third” estimate released by the Bureau of Economic Analysis. The growth rate was revised down 0.1 percentage point from the “second” estimate released in November. In the second quarter, real GDP increased 3.9 percent.

GDP highlightsQ2Q Growth 1222
The third-quarter increase in real GDP mainly reflected a rise in consumer spending. Spending on nondurable and durable goods increased. Spending on services also increased, notably on health care.

The following also contributed to the increase in GDP: Business investment, state and local government spending, residential investment, and exports.

The contributions to real GDP growth were partly offset by a decline in inventory investment, notably in manufacturing and in wholesale trade. Also, imports, a subtraction in the calculation of GDP, increased.

Real final sales of domestic product—GDP less inventory investment—increased 2.7 percent in the third quarter, compared with a 3.9 percent increase in the second quarter.

Revisions
The slight revision to real GDP growth mainly reflected a downward revision to private inventory investment, notably to wholesale trade and to manufacturing. For more information, see the technical note.

Corporate profits
Corporate profits decreased 1.6 percent at a quarterly rate in the third quarter after increasing 3.5 percent in the second quarter.Q2Q Growth in Profits 1222

  • Profits of domestic nonfinancial corporations decreased 0.9 percent after increasing 1.9 percent.
  • Profits of domestic financial corporations increased 0.5 percent after increasing 9.6 percent.
  • Profits from the rest of the world decreased 5.7 percent after increasing 2.9 percent.

Over the last 4 quarters, corporate profits decreased 5.1 percent.

For more information, read the full report.