And now for some bad news. In April, the BEA announced that GDP had grown 2.5 percent in the first quarter of the year. Not great, but not too bad. At the end of May, that was revised down a tick to 2.4 percent. Today, in its final estimate, the hammer was dropped:
The U.S. economy grew at a slower pace than previously estimated in the first quarter as consumer spending and business investment were revised sharply downward, amid signs the pace of growth is likely to have slowed in recent months.
The nation's gross domestic product, the broadest measure of all goods and services produced in the economy, grew at a 1.8% annual rate from January through March....The first quarter's revision was due largely to personal consumption expenditures that notched lower to a 2.6% gain from 3.4%. Consumer spending, which accounts for two-thirds of economic output, largely drove overall gains in the first three months of the year.
So, that economic recovery that you thought was proceeding pretty sluggishly? Well, it's proceeding even more sluggishly than you thought. Apparently the fiscal cliff had a pretty big effect after all. I can't wait to see how the sequester affected second quarter growth.