A further slowing in growth
Insight
July 31, 2012
US GDP – Q2 2012
US GDP grew by only a modest 0.4% (or 1.5% annualized) in the June quarter, a slightly lower rate of growth than in the previous quarter.
- US GDP grew by only a modest 0.4% (or 1.5% annualized) in the June quarter, a slightly lower rate of growth than in the previous quarter.
- The composition of GDP was even less positive, with the inventory cycle likely to be a moderate headwind in the near term.
- We expect growth to be similar in the current quarter before strengthening towards the end of the year and into 2013. The forecasts are broadly unchanged. We expect GDP will grow by 2.2% in 2012 (previously 2.1%) and 2.6% (previously 2.7%) in 2013.
- The Fed is likely to enact some further stimulus measures in the next one-to-two meetings. Extended forward guidance and/or additional QE look the most likely options.
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