US Gross Domestic Product (GDP)

US gross domestic product (GDP) is the broadest measure of growth in the world's largest economy: the value of all goods and services produced in the US in a quarter, after removing the effect of inflation. US GDP is released in three rounds each quarter, and each round appears separately in the calendar. At the top of this page you can see the next release time in Tehran time, the latest actual and forecast figures, and recent releases; this guide explains how to read the US GDP figure and why the market doesn't react equally to all three rounds.

What is US GDP and who publishes it?

GDP data is published by the US Bureau of Economic Analysis (BEA). The figure you see in the calendar labeled q/q is real (inflation-adjusted) growth versus the previous quarter, but it is reported as an annualized rate ; that is, one quarter's growth is expressed as what it would amount to if it continued at the same pace for four quarters. That's why the US GDP figure shouldn't be compared directly with quarterly growth in the eurozone or the UK, which is usually not annualized.

Components of GDP

• Household consumer spending: the largest component, about two-thirds of the US economy. Monthly US retail sales data is an early signal of this component.
• Investment: including construction, equipment and changes in business inventories.
• Government spending and net exports (exports minus imports).

Inventories and net exports are highly volatile and sometimes pull the headline figure up or down without any change in real demand. That's why analysts also look separately at growth in private consumption and investment.

US GDP release schedule: three rounds each quarter

For each quarter, the BEA publishes three successive estimates, which appear in the calendar under these names:

Round in the calendar	Official name	Importance for the market
Advance GDP	Initial estimate, about one month after the quarter ends	Highest; the first picture of the quarter
Prelim GDP	Second estimate, about one month later	Lower, unless the revision is large
Final GDP	Third estimate, one month after that	Usually low

The release is usually at 8:30 a.m. New York time; that is, 16:00 Tehran time in months when the US is on daylight saving time and 17:00 in winter. The countdown at the top of the page shows the exact date of the next round.

How to read the actual, forecast and previous figures

As with other data, the market reacts to the gap between the actual figure and the forecast. In the second and third estimates, the "Previous" column is usually the earlier estimate for the same quarter; so the key comparison there is whether the figure has been revised up or down from its own previous version.

The GDP report also includes quarterly price indexes, including PCE inflation for the whole quarter. Since the monthly PCE price index figure is released separately later, this section is sometimes a preview of it, and if it surprises it can decouple the market's reaction from the growth headline. One common belief is also inaccurate: two quarters of negative growth in the US do not officially mean a recession is declared; recession dates are set by a committee at the National Bureau of Economic Research (NBER) based on a range of indicators.

Impact of GDP news on the dollar, gold and indices

Stronger-than-expected growth usually means the Federal Reserve is in no hurry to cut interest rates; the dollar tends to strengthen and gold per ounce often comes under pressure. Weaker-than-expected growth usually works the other way. For indices such as the Nasdaq 100 and the Dow Jones the reaction cuts both ways: better growth is good for corporate earnings, but if it reinforces expectations of higher interest rates, it may also bring selling pressure.

In practice, GDP is a lagging statistic, and the market has already guessed much of it from monthly data such as the US jobs report and retail sales. That's why the reaction to GDP is usually calmer than to NFP or inflation, unless the figure is far from expectations. The ultimate effect of these data shows up in the Federal Reserve interest rate decision .

Risk tips on GDP release day

GDP is sometimes released at the same time as other US data, and the first-minute move may be the result of a different release; before the release time, check that day's economic calendar . Spreads widen at the moment of the release, so use the trader's calculator to size your trade so that a sudden move doesn't exceed your risk limit. This page is not a buy or sell recommendation.