The U.S. economy is officially pedaling backwards, with first-quarter GDP registering its steepest contraction since the Great Financial Crisis, according to U.S. government figures released on Wednesday.
The U.S. Commerce Department said that first-quarter gross domestic product, the broadest measure of goods and services produced across the economy, contracted at a seasonally adjusted annual rate of 4.8% in the first three months of the year.
That was almost a full percentage point more than the 4% contraction expected by economists polled by FactSet.
The report provided a grim early-days snapshot of the impact that widespread disruptions in the U.S. economy at the hands of the coronavirus pandemic have caused - particularly since responses to Covid-19 only began in earnest in the final three weeks of March.
The 4.8% drop in GDP marks the first time quarterly economic output shrank since the first quarter of 2014, when it fell at a 1.1% pace. It also represents the steepest drop-off since the depths of the last recession, which ended in mid-2009.
Most economists are expecting an even bigger plunge in economic activity in the second quarter, with the economy mostly shut down in April and only now beginning to come back online, with only a few states moving to partially lift restrictions and reopen.
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