Text/Observer Network Liu The first estimated data released by the US Department of Commerce on June 26, 65438 local time shows that the real gross domestic product (GDP) of the United States increased by 2.9% at an annual rate in the fourth quarter of 2022, higher than market expectations, but slower than the previous quarter. The report predicts that the American economy will grow by 2. 1% in 2022, which is significantly lower than the growth of 5.9% in 2026.5438+0.

Although US President Biden regards the fourth quarter data as "good news for the US economy", economists see that the kinetic energy of US economic growth is disappearing from key data such as personal consumption expenditure, which shows that the slowdown or even recession of economic growth is "enough warning signal".

Bloomberg: If the US economy cools down as expected by the Federal Reserve, it will face the risk of stagnation in 2023.

Reuters: The economic growth is expected to be strong in the fourth quarter, but the outlook is bleak.

Against the background of high inflation and aggressive interest rate hike by the Federal Reserve, the GDP of the United States continued to grow negatively in the first and second quarters of last year (-1.6% and -0.6% respectively), and resumed positive growth in the third quarter, with a growth rate of 3.2%. Reuters's survey of economists shows that before the release of this report, the market generally expected that GDP growth in the fourth quarter might be 2.6%, and the growth rate of personal consumption, which accounts for about 70% of the total US economy, would also be higher than that in the previous quarter.

Judging from the figures released by the US Department of Commerce, the GDP growth rate in the fourth quarter was significantly higher than market expectations, which was attributed by the Ministry of Commerce to the increase in consumer and government spending. The Ministry of Commerce pointed out that the GDP growth in the fourth quarter reflected the growth of private inventory investment, consumer expenditure, federal government, state government and local government expenditure and non-residential fixed assets investment, but some of the growth was offset by the decline in residential fixed assets investment and exports, and imports also declined.

It is worth mentioning that on the day when the data was released, Biden, who was visiting Virginia, boasted about the economy in the fourth quarter in advance and refuted the statement about the US economic recession. He said that "since I was elected, some people have been saying that we will fall into recession", but he got some "good news about the American economy", which may be better than expected.

However, this new report has not dispelled people's worries about the economic recession in the United States. Bloomberg reported on 26th that economists found many risk signals after in-depth study of the details, especially the weakening demand, which indicated that the US economic recession remained a major challenge in 2023.

Personal consumption expenditure (PCE) is considered as the "most important driving force" of the US economy, but the report shows that its growth rate in the fourth quarter is only 2. 1%, which is lower than the market expectation, and the growth rate is greatly reduced from 2.3% in the previous quarter. Another measure of potential demand, that is, the final sales to domestic buyers after deducting inflation, only increased by 0.8%.

Eliza Unger, chief economist of Bloomberg, said that the two indicators excluding large fluctuations highlighted the sharp slowdown in economic growth.

Quarterly change of real GDP growth rate in the United States (chart of American consumer news and business channel)

stifel Nicola us &； Lindsey Piegza, chief economist of Chicago Co., said, "When we observe the consumption situation as the pillar of the American economy, it is obvious that the growth momentum is disappearing."

"If consumers can't cheer up, then we can't expect the economy to maintain positive growth at all, let alone stronger growth as we saw this morning. We are slipping into recession. " Pieza said.

Bloomberg said that the American consumer market is being suppressed by the soaring cost of living. During most epidemics, consumers' wages can't keep up with the price increase, and many people can only rely on the excess deposits accumulated before to maintain their expenses.

Last year, the Federal Reserve raised interest rates seven times in a row since March, with a cumulative increase of 425 basis points, and hinted that it would raise interest rates further to control inflation. Bloomberg predicts that the Fed's interest rate hike may seriously affect the household budget this year, which usually takes several months to see the impact of rising borrowing costs.

The tightening of monetary policy has also put pressure on other aspects of the US economy. The report pointed out that in the fourth quarter, corporate investment slowed down sharply, residential construction continued to decline, and the real estate boom reversed. The Fed is expected to raise interest rates by 25 basis points again next week, and Fed officials have hinted that interest rates will remain high for the rest of this year until inflation is defeated.

However, Ernst &; Young) chief economist Gregory? Gregory Daco predicts that if the decline in consumption growth rate is more serious in the future, the Fed may have to switch to easing policy before the end of 2023.

He said: "The Fed is determined to tighten monetary policy. The lagging influence of monetary policy on economic activities increases the possibility of policy mistakes. We believe that the possibility of cutting interest rates twice by the end of 2023 still exists. "

Sam Bullard, senior economist at Wells Fargo Securities, said: "It seems that this may be the last relatively positive and strong quarterly report we will see. "The market and most people will study this figure carefully. But recent data show that the economic momentum is continuing to slow down. "

"Consumer demand in the service industry pushed the US economy to grow strongly in the fourth quarter, but the good news ends here." Eliza Wenger, chief economist of Bloomberg, said.