Third estimate GDP data indicates US first quarter GDP grew at a faster rate than previously thought. Q1 growth figure have been revised up from annualised 0.8% to 1.1% as a result of higher US exports and non-residential investment, although consumer spending was pared back in the latest figures.
US GDP numbers are published in a manner which is different to most other countries; quarterly figures are multiplied by four to give an annualised figure. In countries such as Australia and the UK, an annual figure is calculated by taking the latest number and comparing it with a figure from a year ago. The diagram below shows US GDP once it has been expressed in the normal manner.
According to cash futures prices, the new data is unlikely to have any effect on the voting intentions of FOMC members at the July meeting. Prices implied a zero chance of a rate rise and a 7% chance of a rate cut, a possibility which has arisen amongst the UK Brexit vote. The US bond market took a slightly different view and sent US 10 year yields 4bps higher to 1.47%.