“The third GDP estimate released today is based on more complete source data than is available for the second estimate released last month. In the second estimate, the decline in real GDP was 1.5%. The update primarily reflects a downward revision to personal consumption expenditures that was partly offset by an upward revision to private inventory investment,” the BEA said in a press release.
It highlighted that in the first quarter, an increase in COVID-19 cases related to the Omicron variant resulted in continued restrictions and interruptions in the operations of establishments in some parts of the country.
Government assistance payments in the form of forgivable loans to businesses, grants to state and local governments, and entitlements to households fell as provisions for various federal programs expired or were reduced.
“The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the first quarter because the impacts are generally embedded in the source data and cannot be identified separately,” he said.