US economy contracts again in 2nd quarter

US economy contracts again in 2nd quarter

According to the first reading of the Commerce Department on Thursday, the US economy contracts again in the 2nd quarter at a rate of 0.9% annually.  

The expectation of the market was an expansion of 0.5%, after the largest economy in the world contracted 1.6% in the first quarter.

The data occurs just a few days after President Joe Biden tried to reject the fears of the recession.

Biden said on Thursday that the US economy has recovered all the jobs of the private sector lost during the crisis of the pandemic of the Coronavirus, but added that “it is not surprising that the economy is slowing down as the Federal Reserve acts to reduce inflation”.

Biden said in a statement that the “US job market is very strong with the unemployment rate at 3.6%. During the second quarter, more than 1 million jobs were created. Consumer spending is also increasing.”

Biden also added that the economic plan of his administration aims at demolishing inflation without giving up all the economic profits that have been achieved.

Dollar GDP is currently standing at $ 24.85 trillion in the second quarter.

Many fear that the US economy can be attracted to a recession due to the aggressive monetary tightening of the Federal Reserve.

However, the GDP is only one of many factors that the US National Bureau of Economic Research considers in a recession.

Jerome Powell

The chairman of the Fed, Jerome Powell, said on Wednesday that the central bank would monitor the GDP figures “carefully”, adding that the “slowdown in the second quarter is remarkable”.

He also tried to calm the concerns about the recession, saying: “I don’t think the United States is currently in a recession. The reason is that there are too many areas of the economy that work well. “

US economy contracts again in 2nd quarter