The economy under Joe Biden has contracted for the second quarter in a row, demonstrating that the U.S. is already in recession, according to some definitions.
According to data released by the Bureau of Economic Analysis on Thursday, real GDP in the United States have lowered at a yearly rate of 0.9 percent in the second Quarter of 2022, failing to meet expectations for a modest 0.4 percent growth according to economists polled by Bloomberg. GDP contracted 1.6% in the first quarter, and most economists and columnists consider a recession to be two straight quarters of neg. GDP growth.
Despite the fact that the previous two quarters have shown negative development, the Biden administration has disputed the claim that America is in a recession.
“At the end of the day, the typical American family has been experiencing economic hardship for the past 18 months, as paychecks are being spent faster than they are coming in due to inflation, credit card debt is getting more difficult to service, and regular folks can not afford a house. In my opinion, if you go out and speak with average Americans, it’s quite obvious that the economy is shrinking.” E.J. Antoni of The Heritage Foundation’s research department said.
The weak expansion on Thursday was attributed to private inventory investment decreases, residential fixed investment, and government spending by the federal government and states and local governments.
In the meantime, as the economy slows, prices remain high while inflation rises; the Consumer Price Index (CPI), a key inflation indicator, was 9.1% in June, breaking previous records since 1981. Even more significantly than what consumers have experienced in recent months, producer costs have gone up by 11.3%.
The Federal Reserve increased rates by 0.75 percent on Wednesday to battle inflation, but this may have a negative impact on economic development.