Slower private consumption and investment weigh down on OECD GDP growth in third quarter of 2017

Slower private consumption and investment weigh down on OECD GDP growth in third quarter of 2017

Real GDP growth in the OECD area slowed marginally to 0.7 % in the third quarter of 2017, compared with 0.8 % in the previous quarter, according to provisional estimates, as contributions from private consumption (0.3 percentage point, compared with 0.5 in the previous quarter) and investment (0.1, compared with 0.3) fell. Stockbuilding and net exports, however, with contributions of 0.2 and 0.1 percentage points respectively, mitigated the slowdown in overall GDP growth. The contribution from government consumption was negligible.

 

Drivers of GDP growth varied across the Major Seven economies

In the United States, GDP growth was stable at 0.8 %, reflecting a lower contribution from private consumption (0.4 percentage point, from 0.6 in the previous quarter) that was counterbalanced by higher contributions of stockbuilding and government consumption (0.2 and 0.1 percentage point respectively, up from 0.0 in the previous quarter). Contributions from investment and net exports were stable (0.1 percentage point each).

In Germany, real GDP growth picked up to 0.8 %, compared with 0.6 % in the previous quarter. The strong rebound of net exports (contributing 0.4 percentage point, up from minus 0.4 in the previous quarter) and the stronger  contribution of stockbuilding (0.4 percentage point from 0.2) were only partially offset by a negative contribution from private consumption (minus 0.1 percentage point, down from 0.5) and a lower contribution from investment (0.1, down from 0.3).

In Japan, real GDP growth slowed slightly to 0.6 %, compared with 0.7 % in the previous quarter. Net exports and stockbuilding (contributing 0.5 and 0.4 percentage point, respectively, compared with minus 0.2 and 0.0 in the previous quarter), were the main drivers of  overall GDP growth, but they were more than offset by a strong drop in the contribution of  private consumption (minus 0.3 percentage point, down from 0.5).

In France, GDP growth was stable at 0.6 %, reflecting a strong rebound in stockbuilding (0.5 percentage point, up from minus 0.4 in the previous quarter) and a higher contribution from private consumption (0.3, up from 0.1). These positive effects were completely offset by deterioration in the trade balance (minus 0.6 percentage point, compared with 0.6 percentage point in the previous quarter). Contributions of investment and government consumption were unchanged.

In the United Kingdom, GDP growth picked up marginally to 0.4 % (up from 0.3 %), as a result of stronger contributions from private consumption and stockbuilding (0.3 and 0.1 percentage point respectively, up from 0.1 and minus 0.4 in the previous quarter).

In Italy, GDP growth increased marginally to 0.4 % (from 0.3 %), mainly reflecting higher contributions from net exports (0.2 percentage point, up from minus 0.4) and investment (0.5 percentage point, up from 0.2). These effects were almost fully offset by destocking (minus 0.5 percentage point, down from 0.4 in the previous quarter).

In Canada, GDP growth slowed to 0.4 % in the third quarter of 2017, from 1.0 % in the previous quarter, as a result of a strong deterioration in the trade balance (minus 0.8 percentage point, from minus 0.1). This was only partially counterbalanced by stockbuilding (0.3 percentage point, up from 0.0).

Note: Contributions may not sum to GDP growth due to rounding.

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