United States grows more in the first quarter but remains the recession on the horizon
Washington - May 29, 2008 - The Gross Domestic Product (GDP) of U.S. grew by 0.9% in the first quarter of 2008, according to the first review by the Department of Commerce, which represents an improvement of three tenths front the fact that progress was made on April 30. However, this figure is not yet final because it is calculated once again. Analysts consider the possibility that the first global economy falling into recession is still present.
The market consensus developed by Bloomberg expected average growth of 0.9% for the revision, so that the reference is in line with forecast. It must be remembered that the U.S. economy grew by 0.6% in the last quarter of 2007.
"We are on the thin line between expansion and recession," says Michael Feroli, economist at JP Morgan in New York. In any case, He thinks that the U.S. "will have poor growth rate" in the remainder of the year.
Former Federal Reserve Chairman Alan Greenspan has pointed out U.S. this week that a recession in the U.S. economy remains likely. "There are more than 50% chance of a recession," he said in an interview to the newspaper Financial Times.
In addition, the recent downward revision of growth forecasts for the Fed not invited itself to optimism. The U.S. central bank has placed its estimate of growth for this year in a range between 0.3 and 1.2%, well below the estimate of between 1.3 and 2% made in January.
Why grows more?
The increased pace of growth has occurred primarily by an upward revision of investment in capital equipment, which has now located in na rate of decrease of 0.2% compared to the previous estimated fall of 2.5%. It has also influenced the minor decline in residential investment, trim a 25.5% before when it was estimated in a collapse of 26.7%, but still remains the largest drop in nearly three decades.
Growth in private consumption remains at an increase of 1.0%. Imports fell by 2.6% in the quarter, compared with 2.5% interim step, while exports grew by 2.8%, compared with 5.5% rise in interim.
One thing that has attracted particular attention is to end domestic sales, which fell by 0.1%, the first decline since the recession of 1991.
In addition, it was also revised slightly downwards the growth of prices: underlying inflation (PCE) is now 2.1% from 2.2% previously.
Moreover, the Employment Department reported that initial requests for unemployment benefits rose last week to 4,000 people, up 372,000 applications. For its part, the moving average of the last four weeks reached 370,500 petitions, a decline of 2,500 applications.
Source: El Economista