American Economic growth He lost his strength in the first quarter This year, according to the possibility, the Commerce Department said on Thursday of A mild recession develops while consumer spending weakens.
Consumption boosted the world’s largest economywhich gives it rigidity start until 2023; Recent unrest in the banking sector and rising Interest rates are likely to weigh on look.
The US GDP increased year on year rate of 1.1% from January to March, down from 2.6% in the fourth quarter of last year.
compared to the fourth quarterdeceleration in real gross domestic product (GDP) in the first quarter It primarily reflects deflation in private Inventory investment and slowdown in non-residential fixed The Ministry of Commerce said.
He. She added That this was partially offset by the acceleration in Consumer spending is rising in exports.
gross domestic product growth The number “reflected increases in Consumer Spending, Federal Exports government spending” with some forms of The department said in a permit.
Economic activity was declining along with the US central bank bank Lending rates rose rapidly rate To tackle stubborn inflation. However, the full Modern Fallout financial Sector disturbances – after a failure of Three medium sized lenders last Month – not seen yet.
“Dangerous” to extrapolate
Retail sales rebounded in January, likely to be mild weather. Still, Ian Shepherdson and Kieran Clancy of Pantheon Macroeconomics warned that it would be “dangerous” to extrapolate from apparent strength in the first Three months.
The February and March figures revealed a shortage of The momentum we expect to continue in the second quarter,” they added in note.
Consumers may have been willing to continue spending as they ate into pandemic-era savings, but ruin rate Shepherdson and Clancy said.
Meanwhile, pressure from the banking sector could lead to a tightening of credit conditions, making it even more difficult for Households and businesses for loans.
recent disturbances in banking system Lending standards are expected to be more stringent result in a more Severe recession than expected in the second quarter. However, this will still be a soft touchdown, Ryan Sweet of In the future, Oxford Economics told AFP (AFP). of the latest launch.
“our business cycle indicator shows the economy Lost momentum in February is about to turn negative.”
While the big US banks have emerged relatively unscathed from the recent pressures, “the turmoil may not be there yet over Sweet said.
“The economic costs are not yet fully felt as banks tighten lending and deposit standards in the… small He said the banks fell back.
