{"id":3768,"date":"2023-04-27T16:03:58","date_gmt":"2023-04-27T21:03:58","guid":{"rendered":"https:\/\/embarrdowns.com\/us-economy-slows-more-than-expected-in-q1-2023-concerns-rise-over-risk-of-recession\/"},"modified":"2023-04-27T16:03:58","modified_gmt":"2023-04-27T21:03:58","slug":"us-economy-slows-more-than-expected-in-q1-2023-concerns-rise-over-risk-of-recession","status":"publish","type":"post","link":"https:\/\/embarrdowns.com\/us-economy-slows-more-than-expected-in-q1-2023-concerns-rise-over-risk-of-recession\/","title":{"rendered":"US Economy Slows More Than Expected in Q1 2023: Concerns Rise Over Risk of Recession"},"content":{"rendered":"

The US economy slowed more than expected in the first quarter of 2023, according to a report from the Commerce Department.[0]<\/a><\/sup> Gross domestic product (GDP) grew at an annual rate of just 1.1% in the first three months of the year, compared with a 2.6% pace in the previous quarter, due to tepid business investment and a pullback in inventories.[1]<\/a><\/sup> Consumer spending, which accounts for more than two-thirds of the economy, contributed the most to the first quarter\u2019s growth, surging over the period.[2]<\/a><\/sup> However, momentum slowed as the quarter progressed, raising concerns about the risk of recession.[3]<\/a><\/sup> <\/p>\n

The Federal Reserve has been aggressively hiking interest rates over the past year to control inflation, raising concerns about the impact on consumer and business spending.[4]<\/a><\/sup> The report also revealed a 4.9% increase in the personal consumption expenditures price index, excluding food and energy prices, which is a closely watched inflation gauge for the Federal Reserve.[5]<\/a><\/sup> Stripping out those components, inflation-adjusted final sales to private domestic purchasers jumped at the fastest pace since the second quarter of 2021, boosted by strong consumer spending.[6]<\/a><\/sup> <\/p>\n

However, the slowdown from the previous quarter resulted from a decline in business investment and residential fixed investment, which includes money spent on home buying and construction.[7]<\/a><\/sup> Economists predict that the second quarter will reveal a more pronounced economic slump, with a projected GDP growth rate of a sluggish 0.2%.[8]<\/a><\/sup> <\/p>\n

Despite the risks of recession, consumers have remained resilient, spending robustly on goods and services, particularly in restaurants and bars.[9]<\/a><\/sup> A strong jobs market, with an unemployment rate at 3.5%, is also expected to underpin growth.[10]<\/a><\/sup> Some analysts predict that consumers will use excess savings and purchasing power to make the economic contraction short and shallow.[10]<\/a><\/sup> <\/p>\n

The outlook for the economy remains uncertain and largely depends on the resiliency of the job market.[11]<\/a><\/sup> Still, many economists, including those at the Federal Reserve, expect the cumulative effect of monetary tightening, a retrenchment in business investment, a slowdown in consumer spending and tightening credit conditions to ultimately tip the economy into a downturn.[10]<\/a><\/sup><\/p>\n

0. <\/span>“US economic growth slows sharply as interest rate hikes kick in” The Guardian, 27 Apr. 2023, https:\/\/www.theguardian.com\/business\/2023\/apr\/27\/us-economic-growth-slows-sharply-interest-rate-hikes<\/a><\/a><\/p>\n

1. <\/span>“The U.S. economy is losing steam. Bank woes and other hurdles are to blame.” MPR News, 27 Apr. 2023, https:\/\/www.mprnews.org\/story\/2023\/04\/27\/npr-economy-gdp-growth-recession-mcdonalds<\/a><\/a><\/p>\n

2. <\/span>“The US economy grew at a much slower pace in the first quarter” CNN, 27 Apr. 2023, https:\/\/www.cnn.com\/2023\/04\/27\/economy\/q1-us-gdp-economy\/index.html<\/a><\/a><\/p>\n

3. <\/span>“US in \u2018Worst of Both Worlds\u2019 With High Inflation, GDP Slowdown” Yahoo Finance, 27 Apr. 2023, https:\/\/finance.yahoo.com\/news\/us-worst-both-worlds-high-150424787.html<\/a><\/a><\/p>\n

4. <\/span>“Economic slowdown: Five takeaways from the new GDP report” The Hill, 27 Apr. 2023, https:\/\/thehill.com\/business\/economy\/3975269-economic-slowdown-five-takeaways-from-the-new-gdp-report\/<\/a><\/a><\/p>\n

5. <\/span>“Gold prices unable to hold $2000 an ounce as U.S. GPD grows 1.1% in Q1” Kitco NEWS, 27 Apr. 2023, https:\/\/www.kitco.com\/news\/2023-04-27\/Gold-prices-treading-water-around-2-000-an-ounce-as-U-S-GPD-grows-1-1-in-Q1.html<\/a><\/a><\/p>\n

6. <\/span>“The GDP report’s silver linings – Economy & Business” Axios, 27 Apr. 2023, https:\/\/www.axios.com\/2023\/04\/27\/the-gdp-reports-silver-linings<\/a><\/a><\/p>\n

7. <\/span>“US economic growth slowed significantly at start of 2023” ABC News, 27 Apr. 2023, https:\/\/abcnews.go.com\/Business\/data-expected-show-us-economic-growth-slowed-outset\/story?id=98865089<\/a><\/a><\/p>\n

8. <\/span>“US economy grew 1.1 percent in the first quarter, much slower than expected” The Hill, 27 Apr. 2023, https:\/\/thehill.com\/business\/economy\/3973911-us-economy-grew-1-1-percent-in-the-first-quarter-slower-than-expected<\/a><\/a><\/p>\n

9. <\/span>“US economic growth slows as firms cut investment” BBC, 27 Apr. 2023, https:\/\/www.bbc.com\/news\/business-65414174<\/a><\/a><\/p>\n

10. <\/span>“U.S. GDP rose at a 1.1% pace in the first quarter as signs build that the economy is slowing” CNBC, 27 Apr. 2023, https:\/\/www.cnbc.com\/2023\/04\/27\/gdp-q1-2023-.html<\/a><\/a><\/p>\n

11. <\/span>“US Economic Growth Slows to 1.1% While Inflation Accelerates” Yahoo Finance, 27 Apr. 2023, https:\/\/finance.yahoo.com\/news\/us-economic-growth-slows-1-130855696.html<\/a><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The US economy slowed more than expected in the first quarter of 2023, according to a report from the Commerce Department.[0]<\/a><\/sup> Gross domestic product (GDP) grew at an annual rate of just 1.1% in the first three months of the year, compared with a 2.6% pace in the previous quarter, due to tepid business investment and a pullback in inventories.[1]<\/a><\/sup> Consumer spending, which accounts for more than two-thirds of the economy, contributed the most to the first quarter\u2019s growth, surging over the period.[2]<\/a><\/sup> However, momentum slowed as the quarter progressed, raising concerns about the risk of recession.[3]<\/a><\/sup> <\/p>\n

The Federal Reserve has been aggressively hiking interest rates over the past year to control inflation, raising concerns about the impact on consumer and business spending.[4]<\/a><\/sup> The report also revealed a 4.9% increase in the personal consumption expenditures price index, excluding food and energy prices, which is a closely watched inflation gauge for the Federal Reserve.[5]<\/a><\/sup> Stripping out those components, inflation-adjusted final sales to private domestic purchasers jumped at the fastest pace since the second quarter of 2021, boosted by strong consumer spending.[6]<\/a><\/sup> <\/p>\n

However, the slowdown from the previous quarter resulted from a decline in business investment and residential fixed investment, which includes money spent on home buying and construction.[7]<\/a><\/sup> Economists predict that the second quarter will reveal a more pronounced economic slump, with a projected GDP growth rate of a sluggish 0.2%.[8]<\/a><\/sup> <\/p>\n

Despite the risks of recession, consumers have remained resilient, spending robustly on goods and services, particularly in restaurants and bars.[9]<\/a><\/sup> A strong jobs market, with an unemployment rate at 3.5%, is also expected to underpin growth.[10]<\/a><\/sup> Some analysts predict that consumers will use excess savings and purchasing power to make the economic contraction short and shallow.[10]<\/a><\/sup> <\/p>\n

The outlook for the economy remains uncertain and largely depends on the resiliency of the job market.[11]<\/a><\/sup> Still, many economists, including those at the Federal Reserve, expect the cumulative effect of monetary tightening, a retrenchment in business investment, a slowdown in consumer spending and tightening credit conditions to ultimately tip the economy into a downturn.[10]<\/a><\/sup><\/p>\n

0. <\/span>“US economic growth slows sharply as interest rate hikes kick in” The Guardian, 27 Apr. 2023, https:\/\/www.theguardian.com\/business\/2023\/apr\/27\/us-economic-growth-slows-sharply-interest-rate-hikes<\/a><\/a><\/p>\n

1. <\/span>“The U.S. economy is losing steam. Bank woes and other hurdles are to blame.” MPR News, 27 Apr. 2023, https:\/\/www.mprnews.org\/story\/2023\/04\/27\/npr-economy-gdp-growth-recession-mcdonalds<\/a><\/a><\/p>\n

2. <\/span>“The US economy grew at a much slower pace in the first quarter” CNN, 27 Apr. 2023, https:\/\/www.cnn.com\/2023\/04\/27\/economy\/q1-us-gdp-economy\/index.html<\/a><\/a><\/p>\n

3. <\/span>“US in \u2018Worst of Both Worlds\u2019 With High Inflation, GDP Slowdown” Yahoo Finance, 27 Apr. 2023, https:\/\/finance.yahoo.com\/news\/us-worst-both-worlds-high-150424787.html<\/a><\/a><\/p>\n

4. <\/span>“Economic slowdown: Five takeaways from the new GDP report” The Hill, 27 Apr. 2023, https:\/\/thehill.com\/business\/economy\/3975269-economic-slowdown-five-takeaways-from-the-new-gdp-report\/<\/a><\/a><\/p>\n

5. <\/span>“Gold prices unable to hold $2000 an ounce as U.S. GPD grows 1.1% in Q1” Kitco NEWS, 27 Apr. 2023, https:\/\/www.kitco.com\/news\/2023-04-27\/Gold-prices-treading-water-around-2-000-an-ounce-as-U-S-GPD-grows-1-1-in-Q1.html<\/a><\/a><\/p>\n

6. <\/span>“The GDP report’s silver linings – Economy & Business” Axios, 27 Apr. 2023, https:\/\/www.axios.com\/2023\/04\/27\/the-gdp-reports-silver-linings<\/a><\/a><\/p>\n

7. <\/span>“US economic growth slowed significantly at start of 2023” ABC News, 27 Apr. 2023, https:\/\/abcnews.go.com\/Business\/data-expected-show-us-economic-growth-slowed-outset\/story?id=98865089<\/a><\/a><\/p>\n

8. <\/span>“US economy grew 1.1 percent in the first quarter, much slower than expected” The Hill, 27 Apr. 2023, https:\/\/thehill.com\/business\/economy\/3973911-us-economy-grew-1-1-percent-in-the-first-quarter-slower-than-expected<\/a><\/a><\/p>\n

9. <\/span>“US economic growth slows as firms cut investment” BBC, 27 Apr. 2023, https:\/\/www.bbc.com\/news\/business-65414174<\/a><\/a><\/p>\n

10. <\/span>“U.S. GDP rose at a 1.1% pace in the first quarter as signs build that the economy is slowing” CNBC, 27 Apr. 2023, https:\/\/www.cnbc.com\/2023\/04\/27\/gdp-q1-2023-.html<\/a><\/a><\/p>\n

11. <\/span>“US Economic Growth Slows to 1.1% While Inflation Accelerates” Yahoo Finance, 27 Apr. 2023, https:\/\/finance.yahoo.com\/news\/us-economic-growth-slows-1-130855696.html<\/a><\/a><\/p>\n","protected":false},"author":3,"featured_media":3767,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[47],"tags":[],"_links":{"self":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts\/3768"}],"collection":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/comments?post=3768"}],"version-history":[{"count":0,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts\/3768\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/media\/3767"}],"wp:attachment":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/media?parent=3768"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/categories?post=3768"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/tags?post=3768"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}