By Geoffrey Smith
- The U.S. economy shrunk by an annualized 4.8% in the first quarter of the year, the Bureau of Economic Analysis said on Wednesday, posting the first contraction since 2014 and the deepest since 2008.
The numbers, which are likely to be revised substantially in subsequent estimates, were worse than the 4.0% expectations of analysts polled by .
The decline was principally the result of a collapse in personal consumption, as companies started the process of laying off workers in response to mandated lockdowns across the country. Personal consumption contributed a negative 5.3 points to the headline figure. Business investment also took another 0.4 percentage point off the number as investment in equipment fell by over 15%, while inventories accounted for a drop of 0.5 percentage points.
