American consumers cut back sharply on spending in recent months, slowing the nation’s already sluggish rate of economic growth.
The economy grew at an annual rate of 1.5 percent from April through June, the Commerce Department reported Friday, a pace that confirmed fears that the economy continues to sputter.
Washington real estate has fared better in recent years than the national housing market, which has been swamped with foreclosures, falling prices and homes that are worth less than than their owners owe on them.
.A growth rate below 2 percent isn’t enough to lower the unemployment rate, which was 8.2 percent last month. And few analysts expect the economy to gain momentum in the second half of the year, as concern about debt problems in Europe and the fiscal cliff — a series of tax increases and spending cuts due to take effect in January unless policy makers find an alternative — dampen confidence.
The estimated rate of economic growth in the second quarter marked the weakest quarterly gross domestic product reading since last fall and promises to sharpen the scrutiny on the President Obama’s fiscal policies. .......................................................
She and other Obama administration officials said Congress should act on the president’s jobs proposal, which would invest in infrastructure, hire more state and local government workers, double the payroll tax cut and offer new tax cuts for small businesses. Republicans have blocked the initiative, saying they oppose a tax surcharge on millionaires to pay for the measure.
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The GDP report said growth in consumer spending — which accounts for about 70 percent of economic activity — slowed to an annualized rate of 1.5 percent in the second quarter, down from 2.4 percent in the first three months of the year. Automobile sales slowed from the first quarter, and spending on durable goods was down 1 percent, after being up sharply in the first three months of the year. The savings rate, which was pegged at 3.6 percent for the first quarter, bumped up to a 4 percent rate between April and June.
“GDP growth for 2012 is at risk of undershooting the Federal Reserves already subdued expectations,” Ryan Wang, U.S. economist for HSBC, wrote in a note to investors. “. . . Growth will need to average 2.6 percent in the second half of the year for the Fed’s projection to be met. If policymakers feel this pace of growth is no longer likely, they may decide to pursue further monetary easing.”
http://www.washingtonpost.com/busin...ast-3-months/2012/07/27/gJQAK8diDX_story.html
The economy grew at an annual rate of 1.5 percent from April through June, the Commerce Department reported Friday, a pace that confirmed fears that the economy continues to sputter.
Washington real estate has fared better in recent years than the national housing market, which has been swamped with foreclosures, falling prices and homes that are worth less than than their owners owe on them.
.A growth rate below 2 percent isn’t enough to lower the unemployment rate, which was 8.2 percent last month. And few analysts expect the economy to gain momentum in the second half of the year, as concern about debt problems in Europe and the fiscal cliff — a series of tax increases and spending cuts due to take effect in January unless policy makers find an alternative — dampen confidence.
The estimated rate of economic growth in the second quarter marked the weakest quarterly gross domestic product reading since last fall and promises to sharpen the scrutiny on the President Obama’s fiscal policies. .......................................................
She and other Obama administration officials said Congress should act on the president’s jobs proposal, which would invest in infrastructure, hire more state and local government workers, double the payroll tax cut and offer new tax cuts for small businesses. Republicans have blocked the initiative, saying they oppose a tax surcharge on millionaires to pay for the measure.
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The GDP report said growth in consumer spending — which accounts for about 70 percent of economic activity — slowed to an annualized rate of 1.5 percent in the second quarter, down from 2.4 percent in the first three months of the year. Automobile sales slowed from the first quarter, and spending on durable goods was down 1 percent, after being up sharply in the first three months of the year. The savings rate, which was pegged at 3.6 percent for the first quarter, bumped up to a 4 percent rate between April and June.
“GDP growth for 2012 is at risk of undershooting the Federal Reserves already subdued expectations,” Ryan Wang, U.S. economist for HSBC, wrote in a note to investors. “. . . Growth will need to average 2.6 percent in the second half of the year for the Fed’s projection to be met. If policymakers feel this pace of growth is no longer likely, they may decide to pursue further monetary easing.”
http://www.washingtonpost.com/busin...ast-3-months/2012/07/27/gJQAK8diDX_story.html