US economy shrank at 4.8% rate last quarter

Drop was the sharpest fall since the fourth quarter of 2008 during the Great Recession, and ends longest expansion on record.

By

National News

April 29, 2020 - 9:54 AM

WASHINGTON (AP) — The U.S. economy shrank at a 4.8% annual rate last quarter as the coronavirus pandemic shut down much of the country and began triggering a recession that will end the longest expansion on record.

The Commerce Department estimated Wednesday that the gross domestic product, the total output of goods and services, posted a quarterly drop for the first time in six years. And it was the sharpest fall since the economy shrank at an 8.4% annual rate in the fourth quarter of 2008 in the depths of the Great Recession.

The drop in the January-March quarter will be only a precursor of a far grimmer GDP report to come on the current April-June period, with business shutdowns and layoffs striking with devastating force. With much of the economy paralyzed, the Congressional Budget Office has estimated that GDP will plunge this quarter at a 40% annual rate. 

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