Surprise slowdown in US GDP affects economic expectations

The recent report on the Gross Domestic Product (GDP) of the United States has shaken economic expectations

In the last quarter, growth has been much lower than anticipated, with an increase of 1,6% compared to the expected 2,5%. This change indicates a slowdown significant compared to the 3,4% of the previous quarter and much further from the 4,9% registered in the third quarter of last year. The slowdown has been seen primarily in consumer spending and exports, along with a reduction in government expenditure both federal and local. However, there has been a slight rebound in residential fixed investment and an increase in imports.

Impact on different areas of the US economy

The decline in spending on goods was notable, especially on automobiles and energy products, while the services sector saw an increase led by health and financial and insurance services. Investment in new housing and expenditure on property transfers boosted fixed residential investment. On the other hand, a growth in non-residential investment was reflected in the increase in intellectual property products.

Changes in government spending and the impact of imports on GDP

In addition, State and local government spending showed an increase in employee compensation, although a drop was seen in inventory investment, primarily in wholesale trade. and manufacturing. Imports increased in both goods and services, which subtracts from the GDP calculation.

Rise in price indices reflects unexpected inflationary pressure

Even the price index for gross domestic purchases rose 3,1%, and the price index for personal consumption expenditures rose 3,4%. Excluding food and energy, this index rose 3,7%, showing stronger than expected inflationary pressure.

Market reactions and future expectations.

Likewise, analysts are reconsidering the short-term economic outlook. Neil Wilson of Markets.com and Michael Brown of Pepperstone agree that the data suggests a situation close to stagflation, which could influence the Federal Reserve's next actions. Despite the uncertainty, these data are unlikely to significantly alter current monetary policy, which follows a cautious approach based on the evolution of economic indicators.

Finally, personal income and the savings rate have increased, although the personal savings rate has decreased slightly since the last quarter. These changes reflect an economy that, although facing significant challenges, continues to show areas of resilience and adaptation. The next reading of the Consumer Price Index could provide more clarity on the direction of economic policy in a context of moderate growth and inflationary pressure.