GDP growth was terrible in the first quarter, rising at an annual rate of only 0.7 percent. That’s the worst quarterly performance in two years:
Unfortunately, the details behind the headline number are bad too. Growth was driven almost entirely by investment in buildings, both residential and nonresidential. Personal consumption was up an anemic 0.3 percent. The most common excuse for this miserable performance is that it’s for the first quarter, and first quarters are always bad. There’s some truth to this: first quarter growth has averaged 1.0 percent since 2010. However, we’ve had a pretty mild winter in 2017, so there’s no weather excuse this year.
We’ll see. Maybe the revised numbers will be better. Maybe we’ll make up for this in the second quarter. Maybe.