US Q1 GDP (second reading) +1.2% q/q annualized vs +0.9% expected

• The first reading was +0.7% annualized
• Personal consumption +0.6% vs +0.4% exp
• Initial reading on consumption +0.3%
• GDP ex-vehicles +1.7% vs +1.2% prior
• GDP price index +2.2% vs +2.3% expected
• GDP price index initially at +2.3%
• Core PCE +1.7% vs +1.7% y/y initially
• Deflator +2.2% vs +2.3% initially

Details:

• Inventories cut 1.07 pp from GDP
• Inventories +4.3B vs +10.3B initially
• Exports +5.8% vs +5.8% initially
• Imports +3.8% vs +4.1% initially
• Home investment +13.8% vs +13.7% initially
• Business investment in structures +28.4% vs +22.1% initially
• Consumer spending +0.6% vs +0.3% initially
• Spending on durables -1.4% vs -2.5% initially
• Business investment +11.4% vs +9.4% initially

The business investment and consumer revisions are good news but in the durable goods report, the core orders are soft, so that raises fresh questions on business investment.