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- U.S. economy shrinks as previously estimated in Q1
U.S. economy shrinks as previously estimated in Q1
A report from
the Commerce Department showed on Thursday the U.S. economy contracted as
initially estimated in the first quarter of 2020, as an upward revision to
nonresidential fixed investment was offset by downward revisions to private
inventory investment, personal consumption expenditures (PCE), and exports.
According to
the “third” estimate, the U.S. gross domestic product (GDP) decreased at a 5.0
percent annual rate in the first quarter, as reported in the "second" estimate.
This was the biggest drop in GDP since the fourth quarter of 2008
Economists had
expected the decline rate to remain unrevised at 5.0 percent.
In the fourth
quarter of 2019, the economy expanded by 2.1 percent.
The decrease in
real GDP in the first quarter reflected negative contributions from PCE,
private inventory investment, exports, and nonresidential fixed investment that
were partly offset by positive contributions from residential fixed investment,
federal government spending, and state and local government spending. Meanwhile.
imports, which are a subtraction in the calculation of GDP, fell.
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