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- U.S. economy shrinks less than forecast in Q2
U.S. economy shrinks less than forecast in Q2
The Commerce
Department released on Thursday its "advance" estimate for the U.S.
gross domestic product (GDP) for the second quarter of 2020, which revealed the
U.S. economy shrank less than forecast in the reviewed period.
According to
the estimate, the U.S. real GDP declined at an annual rate of 32.9 percent
q-o-q last quarter, following a 5.0 percent q-o-q contraction in the first
quarter of 2020, reflecting the response to COVID-19, as
"stay-at-home" orders issued in March and April were partially lifted
in some areas of the country in May and June, and government pandemic
assistance payments were distributed to households and businesses. That marked
the steepest pace of contraction in GDP on record.
Economists had
expected GDP to plunge by 34.1 percent.
According to
the report, the decline in real GDP in the second quarter reflected decreases
in personal consumption expenditures (PCE), exports, private inventory investment,
nonresidential fixed investment, residential fixed investment, and state and
local government spending, which were partly offset by an increase in federal government
spending. Meanwhile, imports, which are a subtraction in the calculation of
GDP, fell.
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