Thursday, February 28, 2013

US GDP Barely Grows in Q4 2012; Recovery on Life Support

Today’s second estimate of U.S. GDP for the fourth quarter of 2012 showed growth moving from the -0.1 percent of the preliminary estimate to +0.1. Positive is better than negative, but a look at the details shows that the recovery is extremely weak. The following table shows how much each of the economy’s main sectors contributed to GDP growth in Q4.



Consumption, which has been the main driver of growth throughout the recovery, contributed slightly less in Q4 than previously reported. The categories housing and utilities, gasoline and other energy goods, and clothing and footwear all experienced absolute declines. These figures refer to real expenditures, so they reflect more than just the recent decreases in energy prices. The news is perhaps good for environmentalists, who will be glad to see a continuation of the gradual trend toward lower energy-intensity of GDP. It is not so good for anyone who hopes for consumer-led growth to reduce the stubbornly high unemployment rate. >>>Read more

Follow this link to view or download a classroom-ready slideshow with charts of the latest GDP data
Today’s second estimate of U.S. GDP for the fourth quarter of 2012 showed growth moving from the -0.1 percent of the preliminary estimate to +0.1. Positive is better than negative, but a look at the details shows that the recovery is extremely weak. The following table shows how much each of the economy’s main sectors contributed to GDP growth in Q4.

Consumption, which has been the main driver of growth throughout the recovery, contributed slightly less in Q4 than previously reported. The categories housing and utilities, gasoline and other energy goods, and clothing and footwear all experienced absolute declines. These figures refer to real expenditures, so they reflect more than just the recent decreases in energy prices. The news is perhaps good for environmentalists, who will be glad to see a continuation of the gradual trend toward lower energy-intensity of GDP. It is not so good for anyone who hopes for consumer-led growth to reduce the stubbornly high unemployment rate.
- See more at: http://www.economonitor.com/dolanecon/2013/02/28/q4-gdp-moves-from-negative-to-positive-but-details-show-recovery-still-on-life-support/#sthash.n7KleCy2.dpuf

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