Despite narrower revision, the broadest measure of the nation’s economic activity posts second steepest decline in 27 years.
The U.S. economy shrank at an annual pace of 5.5% in the first quarter, the government said Thursday, a slower pace of decline than previously reported but still the second largest quarterly drop in 27 years.
Economists had expected a 5.7% drop, according to a consensus estimate from Briefing.com.
The first quarter of 2009 marked the third quarter in a row that the economy contracted. It was the second worst drop in the measure since the early 1980s — behind only the fourth quarter of 2008, when GDP plunged at an annual pace of 6.3%.
The government initially reported in April that gross domestic product — the broadest measure of the nation’s economic activity — fell at an annual rate of 6.1% in the first quarter. In its first revision, the government said that GDP declined at an annual pace of 5.7%.
Each quarter, the government revises the GDP twice. Thursday’s report marked the final revision.
Inventories, imports: The decline in GDP was less severe than initially reported because of a downward revision to imports and an upward revision to inventory investments, the Commerce Department said. If the economy is spending less on another country’s goods and spending more to build its own stockpiles, then productivity is higher, working to pump up the GDP.
Imports of goods and services decreased 36.4% in the first quarter, a sharper decline than the 34.1% drop in imports that was previously reported.
Business inventories fell by $87.1 billion in the first quarter, a less severe drop off than the $91.4 billion decrease reported in the first revision. As a result, the subtraction to the annual rate of GDP growth was 2.2 percentage points, rather than 2.34. Businesses cut their inventory levels in the face of falling demand.
The drawdown in inventories will prove to be a catalyst for production in coming quarters, said John Silvia, chief economist at Wachovia. “The key going forward is that we have cleared out a lot of extra inventories.”
Exports, personal spending: A downward revision to exports and personal consumption counteracted the stronger numbers on imports and inventory investments, according to the government report.
Exports plunged 30.6% in the first quarter, a more severe drop than the 28.7% drop reported in the previous revision.
The growth in consumer spending was revised down to 1.4% from the previously reported 1.5%. But the fact that the percentage remained positive was “reassuring to everyone,” according to Silvia.
Looking forward: Silvia said he still expected a decline in second-quarter GDP, although it will be less negative than the first quarterm saying production shutdowns in the auto industry have been too severe to allow the economy to rebound.
“I think the third quarter that will be the start of the economic recovery, not the second quarter,” he said.
One hint of future growth in the first-quarter report was corporate profits, which were up 1.4% after being down 10.7% in the fourth quarter of last year.
“Companies that make money tend to hire workers,” said Silvia.
Tags: economy activity, rate, us economy
Great website…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out[...]……
Links…
[...]Sites of interest we have a link to[...]……
Awesome website…
[...]the time to read or visit the content or sites we have linked to below the[...]……
Recommeneded websites…
Here are some of the sites we recommend for our visitors…
Check this out…
[...] that is the end of this article. Here you’l find some sites that we think you’l appreciate, just click the links over[...]…
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
Gems form the internet…
[...]very few websites that happen to be detailed below, from our point of view are undoubtedly well worth checking out[...]……
Car Insurance companies…
Car insurance companies are the biggest bussiness nowadays,why do you want to get scammed by them?Get a really cheap car insurance quote by staying informed….
Awesome website…
[...]the time to read or visit the content or sites we have linked to below the[...]……
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
You should check this out…
[...] Wonderful story, reckoned we could combine a few unrelated data, nevertheless really worth taking a look, whoa did one learn about Mid East has got more problerms as well [...]……
I found this…
You should see this post…
Earn Online…
This is something to check out…
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
Websites worth visiting……
[...]here are some links to sites that we link to because we think they are worth visiting[...]………
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
Sites we Like……
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]……
Recommeneded websites…
[...]Here are some of the sites we recommend for our visitors[...]……
Visitor recommendations…
[...]one of our visitors recently recommended the following website[...]……
Awesome website…
[...]the time to read or visit the content or sites we have linked to below the[...]……
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
Recent Blogroll Additions……
[...]usually posts some very interesting stuff like this. If you’re new to this site[...]……
Blogs you should be reading……
[...]Here is a great blog you might find Interesting that we encourage you[...]……
Fast Cash Advance Payday Loans…
[...]I think Greg Sopranovich better on this.[...]…
Superb website…
[...]always a big fan of linking to bloggers that I love but don’t get a lot of link love from[...]……
Recent Blogroll Additions……
[...]usually posts some very interesting stuff like this. If you’re new to this site[...]……
Linkup…
Linked up with your blog….
Linkup…
On the latest episode of “The Drive,” which you can watch above, I break down the winners and losers in Monday night’s Republican presidential debate - which included one contender who wasn’t actually in the building…
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
Links…
[...]Sites of interest we have a link to[...]……
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]?…
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
Recommeneded websites…
[...]Here are some of the sites we recommend for our visitors[...]……
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
[...]one of our visitors recently recommended the following website[...]……
Check this out…
[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……
Check this out…
[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
Websites worth visiting……
[...]here are some links to sites that we link to because we think they are worth visiting[...]………
Javita Coffee…
[...]Do you know anyone that drinks coffee? Why not profit from it with Javita http://javamlm.com/……...
Online Article……
[...]The info mentioned in the article is some of the best available [...]………
Awesome website……
[...]the time to read or visit the content or sites we have linked to below the[...]………
Gems form the internet…
[...]very few websites that happen to be detailed below, from our point of view are undoubtedly well worth checking out[...]…
Websites you should visit…
[...]below you抣l find the link to some sites that we think you should visit[...]…
Sites we Like………
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]………
Links…
[...]Sites of interest we have a link to[...]……
Gems form the internet…
[...]very few websites that happen to be detailed below, from our point of view are undoubtedly well worth checking out[...]……
Sites we Like………
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]………