The Office of Economic Analysis of the Department of Commerce reported that the gross domestic product (GDP) of the northern country contracted 0.2 percent in the second quarter of 2022, compared to the previous three months, which technically constitutes an informal indicator of economic recession.
Viewed from an annual rate perspective, real GDP fell 0.9 percent in the April-May-June period, after a 1.6 decline in the first three months of the current year.
The aforementioned entity of the Department of Commerce defined a recession as “a significant decline in economic activity that spreads throughout the economy, lasting more than a few months, usually visible in production, employment, real income, and other indicators.
In this regard, Treasury Secretary Janet Yellen stated that the US economy is in a state of transition, not recession, despite two consecutive quarters of negative growth.
The recession is a general weakening of the economy that includes substantial layoffs, business closures, strain on household finances and a slowdown in private sector activity, and that is not what we are seeing right now, Yellen insisted.
The Treasury secretary began her remarks with a list of the economic achievements of the administration of President Joe Biden, but inflation proves to be the biggest obstacle, rising 9.1 percent year-on-year in June.
Additionally, consumer and business confidence levels have plummeted, and recent polls show that a majority of Americans believe the country is in a recession.
Regardless whether or not the United States entered a recession, the data is bad, according to experts, GDP that includes consumer spending, business investment and housing construction remained unchanged in the second quarter, the lowest result since the closures due to the Covid-19 pandemic.
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