The economy logged a solid 3.8% growth rate in the first quarter, a performance that was better than previously thought and a fresh sign the expansion is on firm footing.
The new reading on gross domestic product, released by the Commerce Department on Wednesday, marked an improvement from the 3.5% annual rate estimated for the quarter just a month ago and matched the showing registered in the final quarter of 2004.
I generally consider 2.5% growth for an advanced economy to be adequate, 3% solid, 3.5% very good and anything over 4% to be phenomenal. So this is quite good news.
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Meanwhile, over in Old Yurp, Germany ain't doing too good:
The Berlin-based DIW institute, one of Germany's six leading economic institutes, halved its forecast for German economic growth this year as booming exports failed to ignite demand for consumer goods and factory machinery at home.
Germany's economy, Europe's largest, will grow 0.9 percent in 2005, the institute said today, lowering its previous forecast, made in January, of 1.8 percent. It also cut its prediction for 2006 growth to 1.5 percent from 2 percent. The DIW is the second institute to cut its 2005 growth forecast in the past week, after Munich-based Ifo lowered its prediction to 0.8 percent on June 23.
And neither is France:
The French economy is expected to grow by just 1.5 pct this year, the Insee statistics office said in its quarterly report, a downward revision from its forecast of 1.6 pct growth made earlier this year. Growth was especially weak in the first quarter of this year, when GDP rose by only 0.2 pct compared with initial readings of 0.6 pct growth, the agency said.
Update: Over at polipundit.com Jason lists the quarterly GDP figures for the past two years. The lowest rate? 3.3 percent. The average? A stunning 4.39 percent.
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