US Q2 GDP Final -0.6%... In Line with Expectations

[Asia Economy Reporter Kwak Min-jae] The U.S. Department of Commerce announced on the 29th (local time) that the GDP growth rate for the second quarter of this year was finalized at an annualized rate of -0.6%. This is the same as the preliminary figure (-0.6%) released last month. The U.S. growth rate is announced three times: advance estimate, preliminary estimate, and final estimate.

The U.S. economy, which contracted by 1.6% in the first quarter, has confirmed negative growth for two consecutive quarters. Generally, when GDP growth records negative growth for two consecutive quarters, it is considered a technical recession. In the U.S., the National Bureau of Economic Research (NBER) officially declares a recession.

This is the first time in two years since the COVID-19 pandemic began in the first and second quarters of 2020 that the U.S. economy has met the definition of a technical recession.

However, the Biden administration, the Federal Reserve (Fed), and many private economists argue that it is not a recession, citing a strong labor market and still solid consumer spending as evidence.

The National Bureau of Economic Research, which officially determines whether there is a recession, has not yet announced its position.

Concerns about a recession continue as the Fed pursues aggressive monetary tightening to curb soaring inflation.