Customer stores to produce -in a Heb grocery store on February 12, 2025 in Austin, Texas.
Brandon Bell | Pictures of getty
The first economic data of the first quarter of 2025 point to the negative growth, according to a bank of the Federal Reserve of Atlanta.
That of the central bank Pibnow Tracker of entring Metrics indicates that the gross domestic product is at the rate of reducing 1.5% for the period of March January, according to an update published on Friday morning.
The fresh indicators showed that consumers spent less than expected during the inclined January climate and exports were weak, which led to a decrease. Prior to Friday’s consumer spending report, the PDPNow had been indicating a growth of 2.3% during the quarter.
Although the tracker is volatile and usually becomes a more reliable measure much later than the quarter, it does coincide with some other measures that show a growth slowdown.
« This is a great inherent volatility of the very high frequency » Nowcast « maintained by the Atlanta FED, » said Mohamed El-Eian, Principal Economic Minister of Allianz and President of the Queens Cambridge College, In a post In the social networking site X.
The caliber had pointed out the gains of GDP up to 3.9% in early February, but has been in a fall since then as there is additional data.
On Friday, the Department of Commerce reported This personal expense fell by 0.2% in January, and lacking Dow Jones’s estimate for an increase of 0.1%. Adjusted for inflation, spending dropped by 0.5%. As a result, a complete percentage point of the expected contribution to GDP was shaved, up to 1.3%, according to the calculation of the PDPNow.
At the same time, the contribution of net exports decreased from -0.41 percentage point to -3.7 percentage points.
The combination of data and its impact on growth prospects comes Polls showing decrease in consumer confidence and care about increasing inflation. The Department of Commerce also reported that an inflation measure that FED’s favors were reduced during the month, as the basic personal consumption expense price rate fell to 2.6%, by a percentage point of 0.3 since December.
The week also caused some news about the labor market as First unemployment claims Reached a higher level in early October.
In addition, the bond market has also been slower. The 3 -month treasure performance this week moved over the ten -year note, to Historically reliable indicator of a recession on the horizon of 12 to 18 months.
Economic and political uncertainty has led to a start of the year For the stock market. The industrial average of Dow Jones has increased by 2% by 2025 in the midst of wild fluctuations in a volatile news cycle.
« My sense is that the complacency that has taken place in the assets markets is about to be altered, » said Joseph Brusuelas, a United States economist in CSM.
The markets believe that the Fed will respond to the slowdown with multiple interest rate cuts this year. FEDS FEDS FEDS market traders increased the odds of percentage reduction from the fourth to June to 80% from Friday afternoon and increased the possibility of three cuts this year.
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