Now the dollar will not hold anything! In the first quarter, US economic growth accelerated. The GDP grew by 3.2 percent year on year, as reported by the Ministry of Commerce. Growth was spurred by increased public investment, which offset a sharp slowdown in consumer and commercial spending. The report should allay concerns about the recession caused by weak economic data at the turn of the year. Economists had forecast GDP growth of 2 percent. In July, the US economy celebrated 10 years of continuous growth. However, the Fed is likely to ignore the jump and focus on reducing domestic demand, which grew by only 1.3 percent. This has been the slowest rate since the second quarter of 2013, after rising 2.6 percent in the fourth quarter. Apparently, the Fed will not change its solution to stop a three-year-old campaign on the stiffening of money and credit policy.
Exports rose and imports declined, which resulted in a small balance deficit. Trade tensions between the United States and China led to sharp fluctuations in the trade deficit, while exporters and importers are trying to act proactively in the context of the tariff war between the two economic giants. Consumer spending, which accounts for more than two-thirds of US economic activity, has slowed. Moderation in spending reflected a reduction in purchases of cars and other goods, which is probably due to the government's 35-day halt. Business expenses fell sharply with an increase of only 0.2 percent, which was the lowest since the third quarter of 2016. Expenses were constrained by low costs for agricultural machinery and office furniture.
The material has been provided by InstaForex Company - www.instaforex.com