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By Harriet Torry The U.S. economy grew steadily in the fourth quarter of 2020 and is forecast to continue recovering this year from the effects of the pandemic. Yet despite a strong rebound in the second half of last year, the economy contracted 3.5% in 2020, measured year over year, the first decline since the 2008 financial crisis and the largest since 1946. Measured from the fourth quarter to the same quarter a year earlier the economy shrank 2.5% Fourth-quarter U.S. gross domestic product the value of all goods and services produced across the economy, adjusted for seasonality and inflation grew by 4%, the Commerce Department said on Thursday. That joined a record gain in the third quarter to further reduce losses from earlier in the pandemic.
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By Harriet Torry Many U.S. consumers are starting 2021 flush with savings likely to help fuel the economic recovery this year. The latest federal Covid-19 aid package sent $600 checks to many households that also received relief money last year, while more affluent households have built up pools of cash by curbing their spending during the pandemic. Americans saved $1.4 trillion in the first three quarters of 2020, or about twice as much as in the same period of the prior year, according to analysis by Berenberg Economics. That amount is equivalent to nearly 10% of 2019 household spending, estimates Berenberg s chief economist, Holger Schmieding.
The Finance 202: Biden fills out economic team as Trump s coalition continues to implode Tory Newmyer
President-elect Joe Biden’s government is coming together as President Trump’s falls apart. The incoming president will nominate Rhode Island Gov. Gina Raimondo for commerce secretary and Boston Mayor Marty Walsh (D) for labor secretary. He is also set to tap Isabel Guzman, director of California’s Office of the Small Business Advocate, to lead the Small Business Administration; and Don Graves, a former economic advisor who went on to work at KeyBank, to serve as deputy commerce secretary, my colleagues report. The Cabinet picks balance Raimondo, a former venture capitalist who has clashed with organized labor, against Walsh, who has championed the needs of workers. And they amplify a signal Biden has been sending with other personnel decisions that his administration will thread the moderate and liberal wings of his party as he seeks to restore st
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By Harriet Torry WASHINGTON The U.S. trade deficit widened in November, as companies restocking shelves ahead of the holiday season boosted demand for imports. The foreign-trade gap in goods and services expanded 8% from the prior month to a seasonally adjusted $68.14 billion in November, the Commerce Department said Thursday. That was the highest deficit since August 2006, and the goods deficit was the highest on record. Economists surveyed by The Wall Street Journal had expected a trade deficit of $67.3 billion. The fact that the American consumers are back buying a lot of goods means that America s appetite for imported goods is very, very strong, said Chris Rupkey, chief financial economist at MUFG Union Bank. Still, he expects the trade deficit to worsen before it improves because of weak demand for American-made products in regions like Europe hit by the coronavirus pandemic and fresh lockdowns.