Coronavirus Mitigation Efforts Leads to First Negative Reading Under Trump Administration
Forecasts for ranged from a low of -7.0 to a high of -0.3. The consensus forecast was 3.7.
The decline in first quarter GDP was, in part, due to the response to the spread of COVID-19, as governments issued “stay-at-home” orders in March. This led to rapid changes in demand, as businesses and schools switched to remote work or canceled operations, and consumers canceled, restricted, or redirected their spending. The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the first quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified.U.S. Bureau of Economic Analysis (BEA)
This is the first negative reading for GDP under the Trump Administration. Under the Obama Administration, the first quarter was either negative or very weak. It was a trend that — until now — had reversed under the current president.
Real consumer spending came in at -7.6%, missing the consensus forecast. The range was from a low of -6.3% to a high of -0.5%. The consensus was -1.5%.
This article will be updated shortly.