I'm trying to practice reading economic data from FRED and BEA websites, but they seem to be providing conflicting data that I cannot understand at all. For example, looking at Real GDP percentage change quarterly...

FRED: Real Gross Domestic Product | Quarterly | Percent Change

  • Q4 2019: 0.52%
  • Q1 2020: -1.28%

BUT on the BEA website it says:

  • Q4 2019: 2.1%
  • Q1 2020: -5%

How is this possible!?!?!?! There must be something super obvious I'm missing?

  • 4
    $\begingroup$ Offhand, the BEA numbers are almost certainly annualized and will be approximately four times the numbers you’d see if they were reported as quarterly changes. $\endgroup$ – dismalscience May 31 '20 at 3:11
  • $\begingroup$ Interesting, so even though it's a value given / labeled per quarter, it's represented as an "annualized" value? I'm new to this so just trying to understand. $\endgroup$ – blee908 May 31 '20 at 5:15
  • $\begingroup$ I can't seem to find the -1.28% figure at fred.stlouisfed.org/series/GDPC1#0. $\endgroup$ – Kenny LJ May 31 '20 at 5:27
  • $\begingroup$ @KennyLJ I clicked on "Edit Graph" and set units to "percent change" and frequency to "quarterly" $\endgroup$ – blee908 May 31 '20 at 7:20
  • $\begingroup$ dismalscience's comment is your answer. $\endgroup$ – Kenny LJ May 31 '20 at 7:24

The data presented in the BEA website are percent change at annual rates (https://apps.bea.gov/iTable/iTable.cfm?reqid=19&step=2#reqid=19&step=2&isuri=1&1921=survey )

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This is different to the regular growth rate formula that we all know (and what was done in FRED). Here the BEA talks about what that is and why to calculate percentage change at annual rates .


To summarize: BEA publishes percent changes in most quarterly estimates at annual rates. A quarterly percent change at an annual rate shows what the percent change would be if the quarterly rate continued for four quarters. It is computed by compounding the quarterly rate for four quarters.

-formula for computing the percent change from quarter 1 to quarter 2 at a quarterly rate is:

((level of quarter 2/level of quarter 1)-1)*100

-formula for computing the percent change from quarter 1 to quarter 2 at an annual rate is:

(((level of quarter 2/level of quarter 1)^4)-1)*100

BEA also states that for some volatile quarterly series, such as corporate profits, BEA publishes percent changes at quarterly rates rather than at annual rates, because the comparability issue is less important and because annual rates of change may be misleading.


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