Fort Worth, TX (WiredPRNews.com)—Contrary to the caterwauling about a recession, the gross domestic product grew at its fastest pace in nearly a year, according to the Associated Press report citing Commerce Department data.
The “reading was much better than the government’s initial estimate of a 1.9 percent pace and exceeded economists’ expectations for a 2.7 percent growth rate,” according to the AP report released Thursday.
Half of the GDP increase was because of the weak US dollar, which means U.S.-made products are less expensive relative to nations with stronger currencies. “Exports grew at a 13.2 percent pace in the spring, more than double the 5.1 percent growth rate logged in the first quarter,” the AP report indicated.
The Gross Domestic Product (GDP) is one of the best measures of a nation’s economic health because it indicates the value of all goods and services produced. A recession, defined as two consecutive quarters of flat or negative economic growth, has yet to happen.
“The economy actually shrank in the final three months of 2007 and barely budged in the first quarter at a minuscule 0.9 percent pace. The 3.3 percent growth in the spring was the best performance since the third quarter of last year, when the economy was chugging along at a brisk 4.8 percent pace.
While the economy is not as robust as it has been in years past—largely because of increases in energy prices and the tightening of credit by banks—the business climate in the US is nowhere near as dire as some have suggested.
Restrictions on domestic drilling have hurt the United States’ ability to keep gasoline prices down. In addition, tropical storms Gustav and Hanna threaten to drive energy prices back up because they can temporarily shut down refining, shipping and drilling efforts in the Gulf of Mexico.
When Hurricane Katrina hit New Orleans in 2005, it temporarily shut down one of the largest oil shipping ports in the United States. This decrease in immediately available supplies of refined gasoline caused shortages in the Southern U.S. with record high prices per gallon. At one point during the shortage, a gas station in Atlanta was selling the fuel at $6 a gallon.