We knew the United States economy fell off a cliff in the second quarter. On Thursday, we learned just how steep that dive was.
The US economy plunged a staggering 32.9 percent from April through June on an annualized basis, the Bureau of Economic Analysis reported- by far the worst contraction on record.
In the first quarter of this year, when the US officially entered recession in February, the economy shrank 5 percent from the same period a year ago.
Before coronavirus lockdowns swept the nation in March, the worst reading on US gross domestic product (GDP) – which measures the value of all the goods and services produced in the economy – had been recorded in 1950, when the US economy shrank 10 percent in the first quarter.
Thursday’s GDP reading was in line with the higher range of estimates from analysts.
A sharp contraction in consumer spending was the main driver pushing the economy into a chasm.
Before the pandemic, consumer spending drove two-thirds of economic activity in the US.
This is a developing story. More soon.
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