The U.S. economy contracted at the sharpest rate on record in the second quarter this year, affirming fears that the coronavirus pandemic and measures to contain it drove a historic plunge in consumer and business activity.
Here were the main metrics from the Bureau of Economic Analysis’ (BEA) advance Q2 GDP report, compared to consensus estimates compiled by Bloomberg:
- Q2 GDP annualized, quarter over quarter: down 33 percent vs. down 34.5 percent expected; it was down 5.0 percent in Q1
- Q2 Personal consumption: down 34.6 percent vs. down 34.5 percent expected; it was down 6.8% in Q1
- Core Personal consumption expenditures, quarter over quarter: down 1.1 percent vs. down 0.9 percent expected; it was up 1.7 percent in Q1
Market participants were bracing for an ugly second quarter, with the coronavirus pandemic forcing business closures and disrupting daily life for much of the April through June period.
“The decline in second-quarter GDP reflected the response to COVID-19, as ‘stay-at-home’ orders issued in March and April were partially lifted in some areas of the country in May and June, and government pandemic assistance payments were distributed to households and businesses,” The BEA said in its statement. “This led to rapid shifts in activity, as businesses and schools continued remote work and consumers and businesses canceled, restricted, or redirected their spending.”
Click here for the full report from Emily McCormick at Yahoo Finance.
