Recession Is Here: Fed Predicts Negative 2Q Growth
The U.S. economy is expected to contract in the second quarter, the latest estimate from the Federal Reserve Bank of Atlanta shows.The economy is expected to fall to a negative 1 percent annual rate in the April-to-June period, according to the Atlanta Fed Bank’s GDPNow model. That’s down from an 0.3 percent projection from earlier this week.
The regional central bank cited the latest economic data from the U.S. government. Second-quarter real personal consumption expenditures fell to 1.7 percent, down from 2.7 percent. Real gross private domestic investment growth tumbled to minus 13.2 percent, down from minus 8.1 percent.
“The nowcast of the contribution of the change in real net exports to second-quarter GDP growth increased from [minus] 0.11 percentage points to 0.35 percentage points,” the Atlanta Fed stated.
The next GDPNow update will be released on July 1. A recession is defined as two consecutive quarters of economic contraction.
The update comes one day after the final first-quarter gross domestic product (GDP) reading was revised lower to an annual rate of minus 1.6 percent, the first quarterly dro …