The decline in US GDP in the second quarter reflects the impact of the new epidemic. In March and April, many orders were cancelled in parts of the United States due to social isolation orders.
As business employees and school students continue to work and study remotely, peoples consumption is limited.
However, according to the Bureau of economic analysis, the impact of the pandemic on the overall economy cannot be quantified in the second quarter of GDP because these impacts are usually embedded in the source data and cannot be identified separately.
The decline in real GDP reflects decreases in personal consumption spending, exports, non residential fixed investment, private inventory investment, residential fixed investment, and state and local government spending, but is partially offset by an increase in federal government spending. In the second quarter, US imports also declined.
In the private goods industry, the main reason for the decline of GDP is the shrinkage of durable goods, especially the automobile and parts sectors.
In the private service production sector, the decrease was mainly due to accommodation and food services (dominated by food services and drinking establishments); health care and social assistance (driven by ambulatory health care); transport and warehousing (dominated by air transport); arts, entertainment and leisure; wholesale trade; and professional, scientific and technical services. However, growth in the financial and insurance sectors has offset the decline in GDP in this sector.
Among the GDP created by the government, the GDP created by local and state governments decreased significantly, which was partly offset by the increase in the federal government.
Source: Wall Street news editor in charge: Zhong Qiming_ NF5619