"Real GDP contracted by 1.4% (seasonally adjusted annual rate) in Q1 2022, missing expectations for a 1.0% increase. The headline GDP result overstates the perceived weakness in the U.S. economy and when we look under the hood, the indications continue to point to a low likelihood of a recession this year.
Two swing factors, inventories and trade, pulled GDP lower. Excluding these two measures, a core version of GDP growth, referred to as “final sales to domestic purchasers,” showed a solid increase of 2.7% in Q1 2022.
The best way to interpret today’s GDP data is to combine this quarter and last quarter’s growth rates. In Q4 2021, real GDP growth clocked in at a super-charged rate of 6.9%. The average for the two quarters works out to 2.8%, still a respectable rate of economic growth."
To speak with Ken Kim please contact Allison Rivellini.