Preliminary estimations argued that weak consumer spending in the U.S. during the quarter was the result of adverse weather conditions, encouraging hope for a recovery in the following quarter. However, that was countered by the fact that most of the downward revision of consumption was listed in nondurable rather than durable goods, which does not need to be re-stocked.
Monday 30 June 2014
Glum U.S. GDP data
When the advance estimate for the growth of the U.S. economy was published on April 30th, it presented a mild 0.1% annualized increase. That was a negative surprise in an economy hoping to see some recovery. The second estimate of the same figure, which was published a month later, was considerably worse as it suggested the U.S. economy was contracting by an annualized 1%. The first contraction in 12 quarters was not the end of it. Last Wednesday, when the third estimate was published, it indicated a contraction of 2.9% at the nation’s product, the worst figure in five years. Breaking down the negative change at the headline figure reveals that most of it was due to a drop in the personal consumption as that receded from a 3.1% annualized increase in the second estimate, to just 1% in last week’s data.
Preliminary estimations argued that weak consumer spending in the U.S. during the quarter was the result of adverse weather conditions, encouraging hope for a recovery in the following quarter. However, that was countered by the fact that most of the downward revision of consumption was listed in nondurable rather than durable goods, which does not need to be re-stocked.
Preliminary estimations argued that weak consumer spending in the U.S. during the quarter was the result of adverse weather conditions, encouraging hope for a recovery in the following quarter. However, that was countered by the fact that most of the downward revision of consumption was listed in nondurable rather than durable goods, which does not need to be re-stocked.
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