U.S. Outlook: U.S. growth has slowed considerably. Why?

Scott Anderson
Posted by Scott Anderson
Chief Economist

The first-quarter 2016 advance GDP headline came in at a disappointing 0.5%, following 1.4% growth in Q4 2015.

Graph showing quarterly ups and downs of US GDP.This is the third consecutive year the world’s largest economy would start off the year with dismal GDP growth.

For more details about what’s going on, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on April 29.

Key observations:
  • Without strong evidence that the U.S. consumer is doing fine, Fed policy makers will be hesitant to raise interest rates in the quarters to come.
  • Durable goods consumption is near a three-year low.
  • Goods exports suffered from an annualized decline of 3.4%, and services dropped a mild 0.9%.
  • We remain optimistic about the U.S. consumer, given near-maximum employment and a recent rise in real disposable personal income.

Click here to read my full report.

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