The economic downturn is associated with a reduction in consumer spending due to the highest inflation in the last decade.
The fall in GDP in the United States reached 0.9% year-on-year in the second quarter. Bloomberg writes about this, citing data from the report of the Ministry of Commerce.
In the first quarter, the fall in GDP was 1.6%, remind the agency. Before the report’s release, the median forecast in a poll of economists was for second-quarter GDP growth of 0.4%.
The economic downturn is associated with a reduction in consumer spending due to the highest inflation in the past decade, with a sharp reduction in business and real estate investment due to an increase in the Federal Reserve System’s (Fed) discount rate.
Another negative factor affecting GDP dynamics is the reduction in government spending.
Americans are facing higher prices for almost everything from fuel to food to rent. Wages are rising, but not fast enough to keep pace with inflation, sending consumer sentiment to a multi-year low.
The Fed seeks to contain inflationary pressures, but these are related, among other things, to factors beyond its control, such as the war in Ukraine.
Recall, earlier, sociologists reported that in Ukraine, a significant part began to receive wages lower than before the war. They also noticed that the number of people who lost their jobs increased.
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Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.