Second Quarter National Economic Statistics, Industry Statistics - Second-Quarter National Economic Statistics

The U.S. economy grew moderately in the second quarter of 1985 with real gross national product (GNP) recording a seasonally adjusted annual growth rate of 2.0%, up from the 0.3% growth of the previous quarter but significantly below the 7.1% growth of the second quarter of 1984 (table I). Personal consumption expenditures grew 5.3%, with purchases of durable and nondurable goods rising 7.4% and 5.1 %, respectively; nonresidential and residential fixed investment--the two components of fixed investment--grew 11.8% and 5.6%, respectively; and Government spending rose 3.6%. However, these gains were tempered by a major decline in the growth of business inventories (from $19.1 billion to $8.3 billion) and the continuing growth of the net export deficit (from -$28.4 billion to -$33.3 billion). While the high value of the dollar compared with other currencies has been a major cause of the expanding trade deficit, its value, as measured by the monthly Federal Reserve Board (FRB) multilateral trade-weighted dollar index, has declined over 17 index points from its February peak to 140.94 in July. The July dollar value was still high historically. The rate of inflation, as measured by the fixed-weighted price index for GNP, remained low at 4.1%, down from 4.3% in the first quarter, and employment continued to grow at a rate sufficient to keep up with new additions to the labor force. Civilian unemployment has remained steady at 7.3% over the past 6 months. Industry Statistics The FRB recently revised its index of industrial production and changed the base year from 1967 to 1977,1/ The revised total index shows a 0.1 % higher annual growth rate between 1967 and 1984 than the previous index. In the slower growing or declining industries, such as metal mining, primary metals, and fabricated metals, however, downward revisions in the indices and rates of growth have occurred. The previous and revised annual rates of growth between 1977 and 1984 for several of the sectors of interest to the mining industry are shown in table 2.