The US economic Meltdown: US economy limps ahead with 0.6 percent growth
The US economy managed to avert the onset of recession as it struggled to grow at a 0.6 percent annual pace in the first quarter, government figures showed Wednesday. The first estimate of gross domestic product was slightly better than expected and came amid fears that the world's biggest economy is headed for recession, generally defined as two consecutive quarters of declining activity. The 0.6 percent growth rate was the same as in the fourth quarter of 2007, the Commerce Department report showed. It was slightly better than the 0.5 percent consensus forecast of private economists.Consumer spending, the key driver of the economy, slowed to a 1.0 percent growth rate from 2.3 percent in the fourth quarter. It was the weakest growth in consumer activity since the 2001 recession.Business investment outside housing fell 2.5 percent in the quarter, the biggest drop in four years, following a 6.0 percent increase in the prior quarter.Additionally, the outlook for the second quarter is troublesome, Markowska added. "Chances to maintain a positive GDP reading in the second quarter are not evident in this data," she said. "Inventories will likely subtract from growth in the second quarter, housing will remain a drag and business spending is unlikely to recover in the near term."
No comments:
Post a Comment