Gross Domestic Product (GDP)

GDP is the single broadest scorecard of an economy's size and momentum. "Gross" means no deduction is made for wear and tear on equipment; "domestic" means location inside the border matters, not the nationality of the producer. A foreign-owned factory operating in Germany contributes to German GDP. The number is usually reported quarterly and annually by national statistics offices.

There are three equivalent ways to calculate GDP: add up all spending (expenditure approach), add up all incomes (income approach), or add up all value added at each stage of production (output approach). They should in theory arrive at the same total, and statisticians reconcile any gaps. The expenditure version — consumer spending + business investment + government spending + net exports — is the most widely quoted in media.

GDP appears constantly in market data because it drives corporate earnings expectations, policy rate decisions, and sovereign credit ratings. Traders typically compare GDP growth rates across countries rather than raw levels. Suppose Country A has a $1 trillion economy growing at 4% and Country B has a $20 trillion economy growing at 1%; the rates tell very different stories about momentum. See live country-level data on the countries page and indicators.