A screeching halt for the US economy? That is what an annualized growth rate of 1.1% represents, but this time, there is much more than meets the eye. The world's largest economy expanded by less than 0.3% on a quarterly basis, but it has good excuses. And the US Dollar has even more reasons to rise.
The US economy expanded at an annualized rate of 1.1% in the first quarter of 2023, the US Bureau of Economic Analysis' (BEA) first estimate showed on Thursday. This reading followed the 2.6% growth recorded in the last quarter of 2022 and came in worse than the market expectation for an expansion of 2%.
Recession talk is premature – but expectations for rate cuts in 2023 have gained traction. Gross Domestic Product (GDP) figures for the fourth quarter pointed to a slower expansion than in the third quarter. Moreover, the Price Index component – aka the "deflator" points to a considerable slowdown in price pressures.
The US economy expanded at an annualized rate of 2.9% in the fourth quarter, the US Bureau of Economic Analysis' (BEA) first estimate showed on Thursday. This reading followed the 3.2% growth recorded in the third quarter and came in slightly better than the market expectation for an expansion of 2.6%.
Stocks head lower, as US GDP heightens expectations of further Fed tightening. Meanwhile, Zelensky’s trip to Washington has coincided with Putin’s pledge to ramp up military spending, leaving little room for optimism of any solution.
