United States GDP shrinks 4.8%
In the first quarter of the year, this indicator was affected by the impact of the coronavirus
The gross domestic product (GDP) of the United States registered an annualized contraction of 4.8% in the first quarter of the year as a consequence of the impact of the Covid-19 pandemic, compared to the 2.1% growth observed in the quarter immediately above, according to the first estimate of the data presented by the Government Economic Analysis Office (BEA).
The agency, however, warned that the full economic effects of the pandemic cannot be quantified, given that the data on which it is based is still incomplete and will take time to update. Furthermore, the full impact of the Covid-19 crisis only began to be felt in the country as of the third week of March.
The US economy has not experienced such a severe contraction since the fourth quarter of 2008, in the midst of a crisis, when the GDP of the North American country observed a drop of 8.4%. It is also the first contraction in the economy since the first quarter of 2014.
Virtually all components of GDP recorded negative data in the first quarter. Household spending contracted by 7.6%, compared to the 1.8% increase in the fourth quarter, which is the worst reading of the data since the second quarter of 1980. Spending on durable goods plummeted by 16, 1%, while in services it decreased by 10.2%.
On their side, business investment contracted 5.6%, compared to the 6% decrease in the previous quarter. The least bulky drop is due to investment decisions made some time in advance. Even so, investment in structures decreased 9.7%, two and a half points more than in the fourth quarter of the year, while investment in equipment fell 15.2%, compared to the 4.3% decrease in previous three months.
K. Tovar
Source: CincoDias
