The Atlanta Journal-Constitution
U.S. boosts GDP estimate for last quarter to 6.6%
But fears are rising that delta variant is starting to cause slowdown.
The U.S. economy grew at a robust 6.6% annual rate last quarter, slightly faster than previously estimated, the government said Thursday in a report that pointed to a sustained consumer-led rebound from the pandemic recession. But worries are growing that the delta variant of the coronavirus is beginning to cause a slowdown.
What’s happening
The report from the Commerce Department estimated that the nation’s gross domestic product — its total output of goods and services — accelerated slightly in the April-june quarter from the 6.5% it had initially reported last month. The economy’s expansion last quarter followed a solid 6.3% annual growth rate in the January-march
period.
In recent weeks, many economists have been downgrading their estimates of GDP growth for this quarter, and for 2021 as a whole, as the now-dominant delta variant has sent confirmed COVID-19 cases rising throughout the country.
New reported cases are now topping 150,000 a day, the highest level since late January. As a consequence, real-time tracking of consumer activities, notably for airline travel and restaurant dining, has weakened in recent weeks.
What some had expected
The government’s upgraded estimate for growth in the Apriljune quarter fell somewhat shy of expectations. Some economists had predicted a 7% annual rate or more. They based that view on a belief that consumer spending had accelerated even faster than the sizzling 11.8% rate first reported. Thursday’s revised estimate for consumer spending, which drives about 70% of economic activity, was upgraded by 0.1 percentage point to 11.9%.