Economy In U.S. Grows At 1.5% Rate On Consumer Spending
Source: Bloomberg News
The U.S. economy expanded at a slower pace in the second quarter as a softening job market prompted Americans to curb spending.
Gross domestic product, the value of all goods and services produced, rose at a 1.5 percent annual rate after a revised 2 percent gain in the prior quarter, Commerce Department figures showed today in Washington. The median forecast of economists surveyed by Bloomberg News called for a 1.4 percent increase. Household purchases, which account for about 70 percent of the world’s largest economy, grew at the slowest pace in a year.
Consumers are cutting back just as Europe’s debt crisis and looming U.S. tax-policy changes dent confidence, hurting sales at companies from United Parcel Service Inc. (UPS) to Procter & Gamble Co. (PG) Cooling growth makes it harder to reduce unemployment, helping explain why Federal Reserve Chairman Ben S. Bernanke has said policy makers stand ready with more stimulus if needed.
“We’re starting the second half on a not-so-good footing,” Michael Hanson, a senior U.S. economist at Bank of America Corp. in New York, said before the report. “The economy is slowing notably. Given the risks, it is unlikely the Fed will sit on their hands the rest of the year.”
Forecasts of 82 economists in the survey ranged from gains of 0.7 percent to 1.9 percent. The GDP estimate is the first of three for the quarter, with the other releases scheduled for August and September when more information becomes available.
Read more: http://www.bloomberg.com/news/2012-07-27/economy-in-u-s-grows-at-1-5-rate-as-consumer-spending-cooled.html
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Even if it weren't I would question the idea that we need to grow faster, as economic growth is the primary driver of fossil fuel consumption, which is the primary driver of global climate change, which is just starting to "get real" for much of the country.
