The U.S. economy shrank at a 4.8 percent pace in the first three months of 2020, the worst plunge since 2008.
This was the first negative reading for gross domestic product, the broadest measure of goods and services produced by the economy, since 2014. Economists had expected a contraction of 3.7 percent.
The report indicates that the deep cuts business shutdowns and social distancing made to what had been a growing economy. These took hold about three weeks from the end of the first quarter.
Consumer spending fell further than expected, plunging 7.6 percent. Economists had forecast a decline of 1.5 percent. The steeper decline suggests that many consumers began to pull back on spending even before formal stay at home orders were in place.
The economy grew at a 2.1 percent annualized pace in the fourth quarter of 2019.
The Bureau of Economic Analysis said in a technical note accompanying the release that this initial reading was probably inaccurate. The actual decline in GDP was likely much steeper than the initial report indicates.
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