U.S. GDP Declines 0.6% In Q2, Unrevised From Previous Estimate

U.S. GDP Declines 0.6% In Q2, Unrevised From Previous Estimate

September 30, 2022

The Commerce Department released its third estimate of U.S. economy activity in the second quarter on Thursday, showing the decrease in gross domestic product was unrevised from the previous estimate.

The report said real GDP fell by 0.6 percent in the second quarter, unchanged from the drop reported last month and in line with economist estimates.

The dip in GDP in the second quarter follows a 1.6 percent slump in the first quarter, with the two consecutive decreases signaling the U.S. economy is in a technical recession.

The Commerce Department said the decrease in GDP was unrevised, as an upward revision to consumer spending was offset by a downward revision to exports.

The extended decline in GDP in the second quarter reflected decreases in private inventory investment, residential fixed investment, federal government spending, and state and local government spending.

Increases in exports and consumer spending helped limit the downside, with consumer spending jumping by 2.0 percent in the second quarter after climbing by 1.3 percent in the first quarter.

Meanwhile, the report showed the annual rate of growth in core consumer prices in the second quarter was upwardly revised to 5.0 percent from 4.8 percent.

“To the extent that there are any clear implications for the Fed, that will further support officials’ current hawkish stance,” said Andrew Hunter, Senior U.S. Economist at Capital Economics.

The surge in core consumer prices, which exclude food and energy prices, was still slightly slower than the 5.3 percent spike in the first quarter.

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