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Topline
The economy last quarter posted its worst annualized showing since the pandemic-induced recession in 2020, the government said Thursday, blaming an unexpected decline in economic activity on the omicron variant of Covid-19 and decreased government assistance.
The government blamed the unexpected decline on the omicron variant of Covid-19 and decreased … [+] government assistance. AFP via Getty Images
Key Facts
Despite economist expectations calling for growth of 1%, the U.S. economy shrank at an annual rate of 1.4% in the first quarter of 2022, the Bureau of Economic Analysis estimated in its Wednesday gross domestic product release.
In the first quarter, a record wave of Covid-19 cases spurred by the omicron variant resulted in continued restrictions and business disruptions, while government assistance programs including forgivable loans to businesses and social benefits to households expired or tapered off—further preventing growth, the government said.
The decrease reflected broad declines in exports, government spending and business inventories, along with increased imports, according to the release.
What To Watch For
On May 26, the government will release an updated first-quarter GDP estimate based on more complete data.
This is a developing story. Please check back for updates.
Further Reading
Major Bank Is First To Forecast A Recession—More Could Follow (Forbes)
This Recession Indicator Is Flashing Warning Signs As Fed, War And Oil Threaten Economic Recovery (Forbes)
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