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New GDP Number Marks a Milestone for Economy

'Officially back and fully recovered,' declares 'Washington Post'
By John Johnson,  Newser Staff
Posted Jul 29, 2021 8:09 AM CDT
New GDP Number Marks a Milestone for Economy
A shopper enters a retail store as a hiring sign shows in Buffalo Grove, Ill., Thursday, June 24, 2021.   (AP Photo/Nam Y. Huh)

(Newser) – The new GDP numbers are out, and they show that the economy grew at a fast pace in the second quarter—though not quite as fast as expected.

  • The number: The nation's gross domestic product increased by 6.5% from April through June, below expectations of 8.4%, reports CNBC.
  • Milestone: That's up slightly from the revised figure of 6.3% in the first quarter, and it marks a milestone. "For the first time since the pandemic took hold, economic output eclipsed its pre-pandemic high, after adjusting for inflation," per the Washington Post. In others words, the US economy "was officially back and fully recovered" as of June.

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  • Weird context: Normally, 6.5% would be seen as a huge number. And it's still drawing quotes like this in the Wall Street Journal. "The economy has come roaring back,” Jay Bryson of Wells Fargo Corporate and Investment Bank tells the newspaper. But given that the GDP fell short of analysts' predictions, CNBC describes the number as "disappointing." The pandemic outliers: GDP rose by a mind-boggling 33% last summer after plunging by a similar percentage in the second quarter of 2020.
  • Four factors: Can the growth last? Many economists are predicting that growth has peaked for the year, per NPR, with four main factors at play: the delta variant, inflation, a worker shortage, and a supply chain shortage that affect products such as computer chips.
  • Overall: Vaccinations and government aid are credited for the continued growth, per the AP. It is expected to be 7% for all of 2021, the strongest figure in a calendar year since 1984, assuming those four factors noted above don't go haywire. Last year, the economy contracted 3.5%.
(Read more GDP stories.)

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