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2025-07-30 20:46:17
Is the Second Quarter Economy "Fasting"? The Deeper Concerns Hidden Behind the Data] ⑴ On July 30th, Beijing time, data from the U.S. Department of Commerce showed that the U.S. economic growth rate rebounded to 3.0% annualized in the second quarter, exceeding market expectations. ⑵ However, this impressive data does not fully reflect the true health of the economy. ⑶ Declining imports were the primary driver of this growth, while domestic demand grew only modestly. ⑷ The economy contracted by 0.5% in the first quarter, the first negative growth in three years. ⑸ Economists point out that trade data significantly distorts GDP due to Trump's tariff rhetoric. ⑹ Final sales to private domestic buyers, a measure of potential growth in the U.S. economy, grew by only 1.2% in the second quarter, down from 1.9% in the first quarter, marking the slowest growth in domestic demand since the fourth quarter of 2022. ⑺ Although the narrowing trade deficit and rising inventories in the second quarter have led some economists to raise their GDP growth forecasts to as high as 3.3%, the general forecast is for economic growth to flatten in the second half of the year. ⑻ Although the United States has announced several trade agreements, its effective tariff rate remains high and approximately 60% of imported goods are not covered by the agreements.
