US GDP Contracts by 4.8% in Q1
The US GDP posted a major contraction for Q1 and Q2 should be even worse
Skerdian Meta•Wednesday, April 29, 2020•1 min read
The US economy went through a soft period during last year, as the global economy weakened due to the trade war between US and China. But, that was nothing compared to what was expected for this year, because of the economic shut-down. The US economy was expected to contract by 4%, but it has contracted further by 4.8%. Below is the report with all the components:
US Advanced GDP Report for 1Q 2020
- Advanced GDP Q1 -4.8% versus -4.0% estimate
- Personal consumption fell -7.6% vs -3.6% estimate
- Core PCE rose 1.8% vs 1.7% estimate
- GDP price index rose 1.3% vs 1.0% estimate
- Exports -8.7%. Imports -15.3%
- Business investment -8.6% versus -2.4%
- Equipment -15.2% versus -4.3% 4th quarter
- Business inventories cuts 0.53% from GDP
- X motor vehicles -4.4% versus +3.1% last quarter
- Durable goods -16.1% versus +2.8% last quarter
The data signals the start of the recession. The worst is yet to come as GDP is expected to plunge in the 2Q by 20% to -30%. We have never seen such a recession before, probably since the great depression or WW2. Although, core PCE rose to 1.8% YoY, against 1.7% estimated so, at least inflation is holding up well.
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Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst.
Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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