US economy shrinks 0.9 pct in Q2

WASHINGTON, July 28 (KUNA) - The US economy shrank 0.9 percent at an annual rate in the second quarter after decreasing 1.6 percent in the first quarter, the Department of Commerce said Thursday.
According to the Commerce Department, the decrease in real gross domestic product (GDP) reflected decreases in "private inventory investment, residential fixed investment, federal government spending, state and local government spending and nonresidential fixed investment that were partly offset by increases in exports and personal consumption expenditures (PCE)." Meanwhile, the price index for gross domestic purchases increased 8.2 percent in the second quarter, compared with an increase of 8.0 percent in the first quarter.
The PCE price index increased 7.1 percent, the same rate as the first quarter. Excluding food and energy prices, the PCE price index increased 4.4 percent, compared with an increase of 5.2 percent.
According to experts, two consecutive quarters of negative GDP signals a recession. (end) si.aa