- Second-quarter GDP contraction revised to 0.6% from 0.9%
- Gross domestic income rises at 1.4% rate in Q2
- Average of GDP and GDI climbs at 0.4% pace
- Weekly jobless claims drop 2,000 to 243,000
The U.S. economy contracted at a more moderate pace than initially thought in the second quarter as consumer spending blunted some of the drag from a slower pace of inventory accumulation, dispelling fears that a recession was underway.
That was underscored by the report from the Commerce Department on Thursday, which also showed the economy growing steadily last quarter when measured from the income side. This fits in with recent solid readings on the labor market, retail sales and industrial production.
Gross domestic product shrank at a 0.6% annualized rate last quarter, the government said in its second estimate of GDP. That was an upward revision from the previously estimated 0.9% pace of decline. The economy contracted at a 1.6% rate in the first quarter. Economists polled by Reuters had expected GDP would be revised slightly up to show output falling at a 0.8% rate.
While the two straight quarterly decreases in GDP meet the standard definition of a technical recession, broader measures of economic activity suggest a slow pace of expansion rather than a downturn.
The economy remains on firmer ground. Underlying retail sales were much stronger than initially reported in May, and that strength persisted through June and July. Industrial production raced to a record high in July, while business spending on equipment was solid. The labor market continues to churn out jobs at a brisk clip.
PragDem
Article URL : https://www.reuters.com/markets/us/revision-shows-mild-us-economic-contraction-second-quarter-2022-08-25/