The recently released Economic Outlook Update (EOU), incorporating 4th quarter 2008 data, is a must-see for BV experts in need of the latest insights on the state of the economy, an overview of key economic factors, and more. A subscriber recently wanted to know why the summary information often changes from quarter to quarter. For those of you wondering the same thing, you should know that differences in the EOU from one quarter to another are due to the timeframe of the data used. In some instances, preliminary data are used, but after the most recent quarter, the report includes data that are final, since information that is more concrete has come in from that previous quarter.
For example: The September 2008 issue reports that the second quarter 2008 GDP increased 2.8%, while the June 2008 issue says the second quarter 2008 GDP increased 1.9%. Why the difference and how can analysts explain the difference in their valuation reports? The answer: To compile the EOU, we use data from the Bureau of Economic Analysis (BEA). The initial publication of the EOU cites preliminary figures, because it falls only one month after the quarter has ended. In the next quarter’s EOU, there will be more data about that previous quarter and the BEA may change their data figures, which is often the case. The bottom line: The report includes the most accurate data available, which may be subject to change several months later, hence the difference from one quarter to the next. Want to take a look at the latest findings? BVWire™ readers can access a Free Download of this important 4th quarter data.
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