Courtesy of Mish.
Real gross private domestic investment (not to be confused with income) is the measure of physical investment used in computing GDP.
Real GDPI measures investment in the private economy, not under the influence of massive amounts of relatively stable government spending. It is an indicator of the future productive capacity of the economy.
Real GPDI rebounded this quarter following three negative quarters, but the trend in investment remains historically weak if not outright recessionary.
Real GPDI – Percent Change From Previous Quarter
The series is so volatile it’s difficult to tell much from that chart other than it looks very weak compared to investment in other 10-year periods.
Real GPDI – Latest 4 quarters
- 2015 Q4: -2.3%
- 2016 Q1: -3.3%
- 2016 Q2: -7.9%
- 2016 Q3: +3.1%
A better way of looking at GDPI is comparing growth to a year ago. Over time, GDPI should rise.
