The bounceback was expected but the size of it wasn’t: Economists had forecast 2% growth from April through June.
From April through June, a drop in imports — the biggest since the COVID-19 outbreak — added more than 5 percentage points to growth. Consumer spending registered lackluster growth of 1.4%, though it was an improvement over the first quarter’s 0.5%.
DB2
Didn’t see any comments when the reverse was true in the 1st quarter !
-2% real GDP decline.
Let’s not do a victory lap just yet.
Seems bacon is getting more expensive.
So if we take the two together
0.995 x 1.05 = 1.025
DB2
This is the first Q2 estimate, two more are coming. Some things to note:
Simple question, would you rather have a higher GDP with lagging investment and declining exports, or a lower GDP with higher investment and increasing exports?
The key is to avoid serious recessions. The pandemic had little effect on the GDP trend, but the 2008 GFC permanently depressed GDP. The long-term trend is lower GDP growth. A chart of the 10-year CAGR of real GDP per capita:
It’s all about the show. From the graphs you posted, import contribution to GDP down over 4% in Q1, and up over 4% in Q2, seems it’s a wash. Q1 was not as weak as it appeared, and Q2 is not as strong as it appears. due to Q1 stockpiling to duck the tariff. But, TPTB don’t let facts get in the way of the narrative “previous quarter was the fault of someone else, this quarter is all me”.
Steve
