The Commerce Department’s revision for first-quarter gross domestic product (GDP) was even worse than the prior report, and even worse than economists were predicting. The preliminary report was up 0.1% in the first quarter, but this has now been revised to down 1.0% in the first quarter.
Bloomberg was calling for a drop of 0.5% and Dow Jones was calling for a drop of 0.6%.
The prior GDP price index remained static from the preliminary reading at 1.3%. Bloomberg was calling for 1.3% as well.
As a reminder, much of the contraction is blamed on the weather’s impact on production and on consumption. Higher imports and slower inventory growth were also a part of the negative GDP reading.
Another issue is that raw corporate profits are declining. The Commerce Department showed that first-quarter corporate profits on an after-tax basis, without inventory valuation and capital consumption adjustments, were at $1.88 trillion. That was down from $1.905 trillion in the fourth quarter.
The good news about this contraction is that it is expected to be an isolated drop. We have also seen a reversal of many of the trends that were negative going back to positive in the second quarter.
ALSO READ: Countries With the Widest Gap Between Rich and Poor
Take This Retirement Quiz To Get Matched With An Advisor Now (Sponsored)
Are you ready for retirement? Planning for retirement can be overwhelming, that’s why it could be a good idea to speak to a fiduciary financial advisor about your goals today.
Start by taking this retirement quiz right here from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes. Smart Asset is now matching over 50,000 people a month.
Click here now to get started.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
