US GDP unexpectedly contracted at a 1.4% annualized rate in Q1
Source: Yahoo! Finance
US GDP unexpectedly contracted at a 1.4% annualized rate in Q1
Emily McCormick · Reporter
Thu, April 28, 2022, 8:31 AM · 3 min read
U.S. economic activity unexpectedly contracted in the first three months of 2022 with lingering supply chain constraints, inflation, and disruptions amid Russia's war in Ukraine weighing on growth.
The Bureau of Economic Analysis (BEA) released its initial estimate of first-quarter U.S. gross domestic product (GDP) Thursday at 8:30 a.m. ET. Here were the main metrics from the report, compared to consensus data compiled by Bloomberg:
-- GDP annualized, quarter-over-quarter: -1.4% vs. 1.0% expected, 6.9% in Q4
-- Personal Consumption: 2.7% vs. 3.5% expected, 2.5% in Q4
-- Core Personal Consumption Expenditures, quarter-over-quarter: 5.2% vs. 5.5% expected, 5.0% in Q4
{snip}
Read more: https://finance.yahoo.com/news/q1-us-gdp-gross-domestic-product-economic-activity-190926750.html
She'll be revising her article for a while.
Here's the placeholder article from yesterday afternoon:
https://finance.yahoo.com/news/q1-us-gdp-gross-domestic-product-economic-activity-190926750.html
Yahoo Finance
Q1 GDP Preview: Economists look for growth slowdown amid inflation, Russia-Ukraine war
Emily McCormick · Reporter
Wed, April 27, 2022, 3:09 PM · 3 min read
U.S. economic activity likely decelerated to the slowest rate since mid-2020, with lingering supply chain constraints, inflation, and disruptions amid Russia's war in Ukraine weighing on growth. ... The Bureau of Economic Analysis (BEA) is poised to release its initial estimate of first-quarter U.S. gross domestic product (GDP) Thursday at 8:30 a.m. ET. Here are the main metrics expected from the report, based on consensus data compiled by Bloomberg:
-- GDP annualized, quarter-over-quarter: 1.0% expected, 6.9% in Q4
-- Personal Consumption: 3.5% expected, 2.5% in Q4
-- Core Personal Consumption Expenditures, quarter-over-quarter: 5.5% expected, 5.0% in Q4
The GDP report will, as usual, serve as a backwards-looking overview of growth, capturing the January-through-March period. However, the metric is still an important indicator of the momentum the U.S. economy maintained at the start of this year -- especially as some pundits now brace for the possibility of a recession in the near to medium term. (1)
And indeed, some of the points used to bolster the case for a downturn likely weighed on the pace of growth in the first quarter. Inflation has run at its hottest rate since the early 1980s, pressuring consumers' propensity to spend. Plus, the Russia-Ukraine war has hit global supply chains that had yet to recover from the pandemic. More recently, a widespread COVID-19 outbreak that ramped up in China last month has also threatened to further hit supply chains and growth.
These myriad concerns will likely manifest in Thursday's GDP report as drags from trade, or "net exports," and inventories. Net exports have dragged on GDP for the past six consecutive quarters, and will likely do so for a seventh in the first quarter of 2022. ... The U.S. goods trade deficit raced to a record high in March at more than $125 billion. Imports, which subtract from headline GDP, reached an all-time high and far outpaced exports. And though inventories rose in March, slowing inventory growth earlier in the quarter while supply chain challenges lingered is expected to ultimately pull down Q1 GDP.
{snip}
(1) https://finance.yahoo.com/news/the-case-against-a-near-term-recession-morning-brief-101455569.html
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From the source:
https://www.bea.gov/news/2022/gross-domestic-product-first-quarter-2022-advance-estimate
April 28, 2022
Gross Domestic Product, First Quarter 2022 (Advance Estimate)
Real gross domestic product (GDP) decreased at an annual rate of 1.4 percent in the first quarter of 2022, following an increase of 6.9 percent in the fourth quarter of 2021. In the first quarter, there was a resurgence of COVID-19 cases from the Omicron variant and decreases in government pandemic assistance payments.
mahatmakanejeeves
(57,590 posts)U.S. Economy Shrank in First Quarter
By Sarah Chaney Cambon
https://twitter.com/sechaney
sarah.chaney@wsj.com
Updated April 28, 2022 8:34 am ET
The U.S. economy shrank at a 1.4% annual rate in the first quarter, the Commerce Department said Thursday, its first contraction since early in the pandemic.
Some economists projected the GDP could have contracted in the first quarter. Many estimated that a contraction or slowdown could largely stem from a slower pace of inventory investment in the first quarter, compared with a rapid buildup of inventories at the end of last year. A widening trade deficitwith the U.S. importing far more than it exportscould also push growth lower.
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FBaggins
(26,757 posts)This is turning into the perfect storm
IronLionZion
(45,516 posts)In one of the latest conspiracy theories. Conservatives think Biden is trying to put America on a diet except maybe for ice cream.
https://www.snopes.com/fact-check/food-processing-plant/
867-5309.
(1,189 posts)Let's hope we bounce back in the next quarter.
Johnny2X2X
(19,108 posts)Expect to hear the word "Stagflation" endlessly on TV for the next 3 months.
This is bad news and a recession right now will doom our Democracy.
shotten99
(622 posts)Hopefully, a recession would ease inflation. This is why the Fed slammed the economy into recession in the early 80s and in 1958.
Of course, Im being optimistic, but it worked before.
Calista241
(5,586 posts)From the The Empire Strikes back.
Historic NY
(37,452 posts)were getting conned now with the prices of gasoline. I can drive a 1 mile radius and find prices from 4.24 to 3.89 . Every Sunoco station gets the fuel from the same place. BP yesterday was cheaper than Costco.
Blackjackdavey
(178 posts)Up here in Northern New York we are treated to gas price gouging at all times -- except now we actually have cheaper gas than everywhere. Nothing more to this comment other than I find the idea that the gougers have been out gouged fascinating.
andym
(5,445 posts)Stagflation is a slow economy (stagnation) with high inflation.
Under Carter the US had high inflation and good economic growth. The Carter appointed Volcker as Fed chairman who was the one that ended stagflation. Volcker raised interest rates to the sky, slowing the economy and sending it into a recession during the beginning of Reagan's term. Reagan's favorability went negative in his second year, but Volcker strong medicine worked and Reagan got the credit for an economic miracle.
progree
(10,912 posts)Is it in anticipation of bad news for Democrats in the midterms? Given today's GDP report.
Well, Q2's first estimate is 3 months from now, late July. Q3's first estimate is late October.
Each estimate is followed by 2 revisions a month apart (e.g. 1st estimate of Q1 is in late April (today), 2nd estimate of Q1 is in late May, the 3rd estimate in late June)
Calista241
(5,586 posts)progree
(10,912 posts)PCE inflation (particularly core PCE inflation) being the preferred inflation indicator by the Federal Reserve.
https://www.marketwatch.com/economy-politics/calendar
So more yuk news likely on the way.
Meanwhile, continuing claims for unemployment insurance is at the lowest level since February 1970, according to today's report.
https://www.democraticunderground.com/10142909223#post1
heckles65
(549 posts)no one's really the poorer.
'Tight labor market?' Employers begging for workers? Not what I encountered entering the workforce in the early '80s. I would have been ecstatic for today's economy.
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