By all accounts, the first quarter of 2016 was a weak one for U.S. economy growth. The final number on the matter was released by the Bureau of Economic Analysis on Monday, with real growth for the quarter coming in at 1.1 percent, which is an upward revision from last month’s estimate of 0.8 percent, but still not very good.
The increase in real GDP in the first quarter reflected positive contributions from personal consumption expenditures—people spending their money—residential fixed investment, state and local government spending, and exports. These were partly offset by negative contributions from nonresidential fixed investment (including CRE), private inventory investment, and federal government spending. Imports, which are a subtraction in the calculation of GDP, decreased.
Also on Monday, the Conference Board reported that its Confidence Index, which had decreased in May, improved in June. The index now stands at 98.0 (1985 = 100), up from 92.4 in May. The Present Situation Index increased from 113.2 to 118.3, while the Expectations Index rose from 78.5 to 84.5 in June.
This was at some variation from the Consumer Sentiment Index, which was published late last month by the University of Michigan, and which showed a slight decline in May. On the other hand, both indexes were relatively positive on the optimism of consumers.
“Consumers were less negative about current business and labor market conditions, but only moderately more positive, suggesting no deterioration in economic conditions, but no strengthening either,” noted Lynn Franco, director of economic indicators at The Conference Board Expectations.