Report: U.S. GDP Falls Short of Expectations

Gage Skidmore from Surprise, AZ, United States of America via Wikimedia Commons

The U.S. economy rose at a disappointing rate over the second quarter, failing to meet expectations yet again. Thursday morning the Commerce Department reported that gross domestic product grew only 6.5% in the second quarter, falling short of the 8.5% growth some analysts predicted.

Fox Business reports:

Thursday’s report offers “more evidence that stimulus provided surprisingly little bang-for-its-buck, with the economy quickly pushing against unexpected supply constraints instead, which have driven inflation higher,” said Paul Ashworth, chief U.S. economist at Capital Economics.

Businesses have since the economy reopened navigated supply-chain issues caused by factories shutting down to help slow the spread of COVID-19. They have also struggled to find workers as extended unemployment benefits have encouraged many to stay home.

The issues have combined to lift core personal consumption expenditures, the Federal Reserve’s preferred inflation measure, to 3.4% annual growth, the fastest since 1992.

Experts also noted that unemployment levels still play a large role in the economy struggling to get back to pre-pandemic levels. States have struggled with a mass labor shortage as Americans have opted to stay on federal unemployment. While many Republican-led states ended the extra federal unemployment aid early the labor market has struggled to bounce back.

According to CNBC:

Still, areas of the economy remain underwater as the labor market in particular has struggled to get back to normal.

In a separate report Thursday, the Labor Department said 400,000 people filed initial claims for unemployment benefits for the week ended July 24. That level is nearly double the pre-pandemic norm and was above the 380,000 Dow Jones estimate. However, it was a decrease from the previous week’s 424,000.

Continuing claims edged higher to 3.27 million, according to data that runs a week behind the headline number. The total of those receiving benefits rose by nearly 600,000 to 13.16 million, according to data through July 10.

Unfortunately, some experts believe the second quarter will be the high point of the country’s long journey towards economic recovery.

“The good news is that the economy has now surpassed its pre-pandemic level,” wrote Paul Ashworth, chief U.S. economist at Capital Economics. “But with the impact from the fiscal stimulus waning, surging prices weakening purchasing power, the delta variant running amok in the south and the saving rate lower than we thought, we expect GDP growth to slow to 3.5% annualized in the second half of this year.”



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Mad Dog
Mad Dog
1 month ago

Government handouts never accomplish the8 stated goals. The real goal is rotal control of the people. Be very afraid of the biden plan.

Bill
1 month ago
Reply to  Mad Dog

Oh yes, it’s all about Biden/Liberal/Marxist power and control of the people, of the votes, make no mistake about it.

Grace
Grace
1 month ago
Reply to  Bill

The plan is to send Federal troops to American cities to replace depleted law enforcement and fight rising crime. Next on the plan is for the Federal troops to go for the guns. Disarm the citizens, peacefully or not. End of story. We have been so busy warring about masks we left the one important flank, freedom, open to defeat.

Jack
1 month ago
Reply to  Mad Dog

Biden’s plan is communism !!

Susanna Donovan
Susanna Donovan
1 month ago

The “Variant” hysteria coupled with Democrats paying people not to work, and thus trying to shutdown small business, is all in the reset plan. People revolt before they sink everything.

Djea3
Djea3
1 month ago

Lets see, all building materials are up 100-400%, finish building materials 25-300% in general, food is up probably 35%, gasoline is up 50+%, durable goods rising at incredible rates and up 20% or so average. Price of real estate skyrocketing in many areas.
The cost of Taco Bell is up almost 50% since Biden took office.
This tells me that in fact the economy is DOWN rather than up. With the values high they have to sell LESS than before to make a few percent difference.
In other words…this article tells us LIES by not addressing the Delta $. We are NOT CLOSE to pre-pandemic sales anywhere!

Nine Island Girl
Nine Island Girl
1 month ago

People get your arses back to work! Period!
Governors, stay strong and stop unemployment benefits now!

Pat Kean
Pat Kean
1 month ago

Do you know pre covid GDP estimate for 2020 was 4.1% for 2022 7.1% the greatest since 1951.
What Biden is given us is the same tepie lack of sizzle all socialist big government bestows.
Say hello to China ruling the roost

Dee S
1 month ago

When will everyone understand the Biden Administration did not steal an election to govern wisely, but to radically change and alter America so that we are no longer a strong, capable, and independent country.

Bill
Bill
1 month ago

Aaaaaa My Brains been wiped

sly8ball
sly8ball
1 month ago

compliments of Biden and the democrats…..

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