GDP Revision Hits Decade High

worker using torch cutter to cut through metalThe U.S. Commerce Department has released its revised reading on gross domestic product (GDP) for the third quarter of 2014. In a nutshell, this revised report blew the doors off the hinges.

GDP was revised from a prior preliminary report of 3.9% up to a whopping 5.0% for the third quarter. Bloomberg and the Wall Street Journal each were calling for a 4.3% revised headline reading, and this tops the 4.6% growth of the second quarter. In fact, it was the best reading in what looks like 11 years.

One driver was health care spending, which was roughly a half-point of that growth. Services was revised to 2.5% from 1.2%.

GDP may have some incidental factors in the report, but a headline reading of 5.0% will turn heads regardless of any exceptions and incidentals.

Unfortunately, investors may be more focused on a dismal durable goods report for November that was released at the same time. That figure is more recent, and it may signal a starting point in the impact of lower oil prices.

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