2007 GDP: Growth and Updates by Quarter

The Year the Bubble Burst

••• The stock market hit a record as the economy showed signs of impending recession. Photo: Getty Images

Economic growth remained strong in 2007 until a drop in the fourth quarter. But if you look at the Bureau of Economic Analysis's estimates, they range from a decline of 0.6 percent to a rise of 2.9 percent. This just goes to prove how even the experts have a hard time realizing the economy is turning from expansion to contraction. That's why it's so difficult for the individual investor to time the stock market or make decisions based on changes in the economy.

It's better to be well-diversified and flexible.

When the BEA published its final estimate of Q4 growth, it said that the economy had contracted .2 percent in Q4 2007. It later revised the estimate up, when more data came in. At the time, people couldn’t believe that perhaps a recession had started. Shortly thereafter, it did.

Here's the original estimates for each gross domestic product release in 2007. The BEA published revisions in 2009, 2010, 2011, 2013 and 2014. As of 2017, there have been no more revisions.The most recent revision is given first, followed by prior estimates. A record of these changes aren't easily available anywhere else.

2007 for the Year: 1.8 percent (1.9 percent in 2011 and 2.1 percent in 2010)

Q1: 0.2 percent (0.3 percent in 2013, 0.5 percent in 2011, 0.9 percent in 2010 and 1.2 percent in 2009)

  • Advance Report - The economy grew 1.2 percent, the lowest in years. However, the stock market hit a new high. This was like March 2000, the beginning of the prior recession.
  • Second Report - GDP was revised down to 0.5 percent growth.
  • Third Report - GDP was revised up a tenth of a point, to 0.6 percent, the lowest growth rate in four years.
  • In April 2008, the BEA revised Q1 2007 GDP to 0.1 percent. In July 2010, the BEA revised it again to 0.9 percent.

Q2: 3.1 percent (3.6 percent in 2011 and 3.2 percent in 2010)

  • Advance Report - It was unlikely that GDP could go from 0.6 percent in Q1 to 3.4 percent in Q2.
  • Second Report - GDP was revised up to an astounding 4.0 percent.
  • Third Report - The Final Report was revised down slightly to 3.8 percent.
  • In April 2008, the BEA revised Q2 2007 GDP to 4.8 percent.

Q3: 2.7 percent (3.0 percent in 2011, 2.3 percent in 2010 and 3.6 percent in 2009)

  • Advance Report - GDP was still so healthy at 3.9 percent, why it might have declined in Q4, and the annual outlook.
  • Second Report - The BEA surprised everyone by revising GDP growth up to 4.9 percent. It was based on updated information that showed higher inventory levels and exports, and lower imports (which subtract from growth). Growth benefited from the dollar's decline. It helped exports (by making them relatively cheaper and more competitive) and hurts imports (by making them more expensive). In fact, Federal Reserve Chairman Ben Bernanke mentioned that the Fed expected Q4 GDP to be much lower, with the slowing trend continuing through the first part of 2008.
  • Third Report - The Final Report remained at a still astounding 4.9 percent.
  • In April 2008, the BEA revised Q3 2007 GDP to 4.8 percent (same as Q2 2007 revision).

    Q4: 1.4 percent (1.5 percent in 2013, 1.9 percent in 2011, 2.9 percent in 2010 and 2.1 percent in 2009)

    • Advance Report - Growth plummeted to 0.6 percent due to the housing market slowdown and related weak consumer spending. Coincidentally, it is the exact same number as GDP growth in Q1 2007. The last time GDP was that low was in Q1 2003, the tail-end of the previous recession. The drop was expected by most economists. Unlike Q3, exports were not helped by the dollar's decline.
    • Second Report - New data confirmed growth was only 0.6 percent.
    • Third Report - No revisions. Growth still at 0.6 percent.
    • In April 2008, the BEA revised Q4 2007 GDP to -0.2 percent, declaring the start of the Great Recession.

    More GDP by Year

    For earlier years, see U.S. GDP History