For Immediate Release: Friday, January 27, 2011
Contact: Phoebe Silag or Karen Conner, news@epi.org 202-775-8810

GDP growth disappointing in last quarter of 2011

Gross domestic product (GDP)—the broadest measure of the nation’s economic activity—grew at an annualized rate of 2.8 percent in the fourth quarter of 2011, an increase from the previous quarter’s 1.8 percent growth rate and the largest quarterly rate of growth since the second quarter of 2010. However, today’s GDP Picture explains that while 2.8 percent growth would likely put very mild downward pressure on the unemployment rate if sustained over a year, it’s unclear that the trend growth of GDP is even as high as this quarter’s release suggests; for all of 2011 growth was just 1.7 percent and the average of blue-chip forecasts is 2.4 percent growth for all of 2012. Furthermore, key indicators of economic health, including final and domestic demand, personal consumption, net exports, state and local government spending and the personal savings rate suggest that the economy’s health is poor.

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GDP Picture: http://bit.ly/yd49BZ