Gulp. We knew the Q2 number would be bad, but this is perhaps at the outer marker of expectations. Economic output dropped almost ten percent in real terms in Q2, which translates to an annualized loss of 32.9% for the quarter. That loss follows on a -5% annualized GDP result in Q1.
That is one big crater from which to emerge, and some may have hoped that better-than-expected results from May and June on some indicators might have mitigated the main damage in April. Unfortunately, that doesn’t appear to be the case:
Real gross domestic product (GDP) decreased at an annual rate of 32.9 percent in the second quarter of 2020 (table 1), according to the “advance” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 5.0 percent.
The GDP estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see “Source Data for the Advance Estimate” on page 2). The “second” estimate for the second quarter, based on more complete data, will be released on August 27, 2020.