GDP benchmark revisions coming on Friday
On Friday, when the BEA reports the initial 2nd quarter GDP numbers, it will do so based on completely revised historical data. Expect some surprises.
What is coming on July 31st is what is known as benchmark revisions of the national income and product accounts (NIPA). Last month, along with the final Q1 2009 GDP figures, the BEA released a statement detailing the changes.
On July 31, 2009, the Bureau of Economic Analysis (BEA) will release the results of a comprehensive, or benchmark, revision of the national income and product accounts (NIPAs). The comprehensive revision will incorporate the results of the 2002 benchmark input-output (I-O) accounts as well as changes in definitions, classifications, statistical methods, source data, and presentation.
Advance information about the comprehensive revision will be posted here as it becomes available.
The revision is the first since the end of 2003. I would expect downward revisions for 2008 and 2009, reflecting a recessionary environment. Both Q1 and Q2 2008 showed real GDP growth even though the recession began in December 2007. Q1 2008 came in at 0.9% and Q2 2008 was a Bush tax cut stimulus-influenced 2.8%. I wouldn’t be surprised to see Q1 2008 cut to a negative number.
At a minimum, expect some major revisions on personal income and savings data which could be wild cards changing economists view of the nature of the present economic outlook. This will not be your typical GDP report.