WASHINGTON (AP) — The U.S. economy shrank at a steep annual rate of 2.9 percent in the January-March quarter as a harsh winter contributed to the biggest contraction since the depths of the recession five years ago. But the setback is expected to be temporary, with growth rebounding solidly since spring.
The Commerce Department says the first-quarter contraction was even more severe than the 1 percent annual decline it estimated a month ago. Two-thirds of the downward revision reflected a decline in health care spending. Another major factor was a bigger trade deficit than initially estimated.
Despite the plunge in economic activity last quarter, many analysts think the economy is expanding at a strong rate approaching 4 percent growth in the current second quarter.
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Yes, that’s certainly a catastrophe. The market will probably plummet in response.
This is what’s wrong with a lot of the measures of economic “health.”
It’s just a tactic to divert attention from Benghazi. Obama is damn good at this don’t ya know!
Heh. The administration was only off by a negative 2.8 percent. That’s going to make it very difficult to reach a 4 percent growth in Q2, but I’m sure our “leaders” know a way to cook the books to accomplish that. Enough with all of this socialist talk from the right. What we need is full-on communism! Where’s Bernie Sanders when we need him?
“Two-thirds of the downward revision reflected a decline in health care spending.”
This reminds me of Robert Kennedy’s famous line about the problem with using GDP to measure progress.
If Americans are getting more health care at lower total cost, that’s going to look like a recession in the aggregate numbers.
Since our “leaders” didn’t know of a way to cook the books for first quarter growth, I wouldn’t expect anything different for Q2.