Once again, the economic numbers are mildly better than expected. But joblessness continues to represent the major problem going forward.
The recession faded in the spring with U.S. economic activity shrinking at a pace of just 0.7 percent, Associated Press reported today on new government figures. That’s a better-than-expected showing that buttressed beliefs the economy is growing now.
The small dip in gross domestic product for the April-June quarter follows the 6.4 percent annualized drop in the first three months of this year, the worst slide in nearly three decades, AP writes.
The final revision of second-quarter GDP comes on the last day of the third quarter, when many analysts predict the economy started growing again at a pace of about 3 percent.
A main reason for the second-quarter upgrade — businesses didn’t cut back spending on equipment and software nearly as deeply as the government had thought. Consumers also didn’t trim their spending as much.
Still, unemployment is expected to rise to 9.8 percent from 9.7 percent when the government releases new figures Friday, AP says. And, unfortunately, double-digit unemployment is forecast for later this year.
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