Latest news with #USBureauofEconomicAnalysis
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First Post
2 days ago
- Business
- First Post
US recession fears rise as personal income and spending fall in May
Amid the tariffs introduced by US President Donald Trump, fears of a recession loom in America as the US witnessed a decline in personal income and consumer spending in May read more Amid the fears of recession and inflation, the US consumer spending declined for the first time since January. According to the new data released by the US Bureau of Economic Analysis, personal income decreased by $109.6 billion (0.4 per cent at a monthly rate) in May. The Commerce Department report also showed that consumer spending fell 0.1 per cent last month after rising 0.2 per cent in April. The 50 per cent drop-off in motor vehicle sales in May was a significant driver of the overall spending retreat. The vehicle industry saw a sharp decline in May because consumers rushed to dealerships to buy cars in March and April, fearing that President Donald Trump's tariffs would send those costs soaring. STORY CONTINUES BELOW THIS AD However, the Friday report also reflected that the consumers pulled back on spending at restaurants and hotels. It is pertinent to note that Consumer spending powers more than two-thirds of American economic activity. The sharp decline prompted concerns among economists who argue that the steep tariffs on imported goods will erode Americans' resiliency. Consumer economy plunders over fear of Trump Tariffs According to the data released by the US Bureau of Economic Analysis, Personal income fell more than expected for the month, sinking 0.4 per cent. However, the economists argued that the May decline was largely a reflection of Social Security payments returning to more typical levels. In March and April, former public workers received large retroactive payments made under the Social Security Fairness Act due to reduced benefits under the prior legislation. Gregory Daco, chief economist at EY-Parthenon, told CNN that despite the recent months' volatility in those income numbers, the trend is one where income growth 'remains quite subdued." 'Real disposable income (what's left after taxes) is currently trending at a pace of 1.7 per cent year over year,' he said. 'That will bring down consumer spending from the 3 per cent (annual) pace that we were accustomed to through most of 2024 closer to 1.5 per cent over the coming months and perhaps even below 1% in the back half of 2025.' He cautioned that the closer the spending growth gets to 1 per cent, the more vulnerable the US economy becomes. 'You're much more subject to a stalling,' he said. 'You're exposed to price shocks, oil price shocks, tariff shocks, interest rate shocks, stock market shocks, and therefore you're more at risk of experiencing a more significant slowdown or possibly a recession.' STORY CONTINUES BELOW THIS AD However, the figures are still concerning. Major economic forecasts now predict sharply slower growth for the rest of 2025, with real GDP expected to weaken to as low as 1.1 per cent by year-end, compared to 2.5 per cent in late 2024. Economists warn that persistent inflation, higher tariffs, and policy uncertainty are putting additional pressure on household budgets and business confidence. Some analysts caution the US could be facing stagflation — a combination of slow growth and stubborn inflation — rather than a typical recession. The probability of a US recession in 2025 remains significant, with estimates ranging from 25 per cent to 40 per cent depending on the model and scenario. While the latest data do not guarantee an imminent recession, the combination of falling income, weaker spending, and negative leading indicators has heightened risks and could signal more economic trouble ahead.
Yahoo
05-06-2025
- Business
- Yahoo
Hoosiers expected to spend 35% of income on bills by 2035, according to new study
TERRE HAUTE, Ind. (WTWO/WAWV) — A new study, conducted by coupon website Bravo Deal, reveals that Hoosiers are projected to spend 35% of their income on household bills by 2035. According to Bravo Deal's research, this 35% of income spent on bills is equivalent to $30,639, nearly tripling the 2011 figure of $11,453, and almost doubling the 2023 figure of $18,597. While the national average of income spent on bills in 2035 is expected to decrease to 29.7%, compared to the 30.4% Americans spent in 2023, Indiana's share of income is expected to be a 4.6% increase from the 2023 national average and 5.3% more than the projected national average in 2035. Where does your city rank in retiree Social Security income? According to the study, Indiana residents' 35% of income allocated to household bills, will be the fifth highest percentage in the nation by 2035. Trailing West Virginia (45%), Louisiana (40.6%), Kentucky (39.2%) and Alaska (35.5%). Bravo Deal's research analyzed consumers' spending patterns and income from 2011 to 2023 from the US Bureau of Economic Analysis to determine how the cost of utilities, insurance, healthcare and car expenses have impacted Americans' finances over time. Bravo Deal said the analysis calculated the percentage of disposable income spent on bills in each state, then measured the percentage change in spending in income. The growth rates between the two years were then used to project how these expenses could affect Americans by 2035. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
USA Today
12-05-2025
- Health
- USA Today
Calif. Gov. Gavin Newsom unveils homelessness plan to clear street camps
Calif. Gov. Gavin Newsom unveils homelessness plan to clear street camps Show Caption Hide Caption Gavin Newsom says California has world's 4th largest economy California was officially named the world's fourth-largest economy, according to the International Monetary Fund and the US Bureau of Economic Analysis. unbranded - Newsworthy California Gov. Gavin Newsom unveiled a wide-reaching plan to tackle the state's severe homelessness crisis that would direct hundreds of cities, towns and counties to effectively ban tent camping on sidewalks and parks, according to a statement released early Monday, May 12. "The Governor is calling on every local government to adopt and implement local policies without delay," the statement says. The move comes as the state prepares for a surge of funding for homelessness and mental health after voters approved a multi-billion-dollar bond measure in November, and after a landmark U.S. Supreme Court ruling in 2024 that opened the door to arresting and fining individuals for sleeping in public spaces. More: California failed to track how billions are spent to combat homelessness programs, audit finds The model ordinance is not a flat directive, giving local municipalities a guideline and an effective choice to implement the policies. The template will be provided to every community as a "starting point," the statement says, so jurisdictions can tailor it. California is the nation's most populous state and is home to a significant portion of the country's homeless individuals. Nearly a quarter of all unhoused Americans live in California, according to federal data and local studies. The two-term governor will join California Department of Health and Human Services Secretary Kim Johnson, the Director of the California Department of Health Care Services Michelle Baass and unnamed mental health leaders at 1 p.m. PT, according to a news release. More: The homeless population is increasing. Will Trump's second term make it worse? The event, which will be livestreamed across the governor's social media pages, is an "announcement regarding his administration's continued transformation of behavioral health services supporting California's seriously ill and homeless populations," the release says. "There's nothing compassionate about letting people die on the streets," Newsom said in the statement. "Local leaders asked for resources — we delivered the largest state investment in history. They asked for legal clarity — the courts delivered. Now, we're giving them a model they can put to work immediately, with urgency and with humanity, to resolve encampments and connect people to shelter, housing, and care." Kathryn Palmer is a trending news reporter for USA TODAY. You can reach her at kapalmer@ and on X @KathrynPlmr.
Mint
05-05-2025
- Business
- Mint
Key trends in charts: How the US is performing under Trump
The early months of US President Donald Trump's second term have already led to global chaos, particularly because of reciprocal tariffs. While US GDP contracted in the first quarter, a recession may still be a few months away. Nevertheless, Trump's approval ratings have taken a hit, bond yields and uncertainty have surged, and the economic outlook has dampened. A stronger US jobs report brought some optimism, but there are questions about whether it will last. The impact of Trump's policies, especially his flip-flops on reciprocal tariffs, is yet to fully kick in. However, the US economy already suffered a setback in the first quarter of the year. GDP contracted 0.3% in January-March, the first such decline since the first quarter of 2022. Since the contraction was mainly on account of a surge in imports in the run-up to the reciprocal tariffs announcement, Q2 may see a rebound, pushing a potential recession to later in the year. Nevertheless, fears of reciprocal tariffs led to a sharp surge in imports in the first quarter as companies and consumers rushed to buy foreign goods. Imports soared 41.3% from the preceding quarter, which pulled GDP growth into negative territory. Since imports are subtracted from the GDP calculation, their impact is usually negative, but Q1 saw a sharper negative contraction. According to the US Bureau of Economic Analysis, the contribution of imports was -5.0 percentage points in the first quarter as opposed to +0.27 in Q4 2024 and -0.82 in the same quarter last year. Also read | Nouriel Roubini: US economic tailwinds will help it overcome tariff headwinds 44%: That's the percentage of Americans who approved of the way Donald Trump handled his job as president in April, down from 47% at the start of his second term in January, according to the presidential approval ratings poll conducted by Gallup. Other presidents who served a second term had a higher approval rating in the same month of their first year. Barack Obama had a 49% approval rating in April 2013, George W. Bush had a 49% rating in April 2005, and Bill Clinton had a 54% rating in April 1997. While stock markets around the world crashed after the reciprocal tariff announcement and have since recovered to some extent, movement in US bond yields made investors especially nervous. Bond selling accelerated after the tariffs came into effect, pushing government borrowing costs higher. The benchmark 10-year bond yield jumped sharply and was as high as 4.48% on 11 April before seeing a partial correction. The surge in bond yields, along with a declining dollar index and rising gold prices, has raised questions over the US's safe-haven status. It's not just investors – US citizens in general are more concerned about the country's economic prospects. According to a survey conducted by the Pew Research Center from 7-13 April, 45% of Americans believe the US's economic situation will worsen over the coming year, up from 37% in February. While Republicans remain more optimistic, negative outlook is on the rise, with 15% of Republicans/Republican-leaning respondents expecting a worse economic outlook in April, up from just 9% in February. Also read: Apple's US tariff-led $900 million pain is India's gain 177,000 : That's the number of non-farm jobs the US labour market added in April, exceeding the Dow Jones estimate of 133,000 and bringing some cheer amid the gloom. As a result, the unemployment rate held steady at 4.2% during the month, remaining near historic lows. While strong jobs data has brought some optimism, economists warn that trade and tariff uncertainties could still take a toll on the economy and lead to a weaker job market as companies adjust their hiring plans in response to trade tensions. Uncertainty has become a dominant theme in economic reporting during Trump's second term. Analysis by reveals a dramatic surge in its US Economic Policy Uncertainty Index, which analyses policy-related economic uncertainty based on the number of news articles across a set of newspapers that contain words related to economic uncertainty. Since Trump took office on 20 January, the index has jumped from 193 to 786. It scaled a recent new peak of 975 on 5 April. Several countries are expected to feel the impact of the US's policies. International agencies have cut India's GDP growth projections for 2025-26 at least once since January. India's growth relies heavily on the information technology (IT) sector and exports to the US. A historical analysis of GDP growth in the US and India shows similar economic momentum, which suggests India is not completely insulated from US economic trends. Also read: Advocates of free trade should articulate an alternative to US tariffs
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Business Standard
05-05-2025
- Business
- Business Standard
'I set the deal': Trump says trade agreements may come as soon as this week
While Trump did not name countries, he suggested trade deals may be finalised within weeks as talks progress with several nations including India amid tariff tensions and slowdown fears New Delhi US President Donald Trump has indicated that his administration could finalise new trade agreements with select countries as early as this week. Speaking aboard Air Force One on Sunday (local time), he declined to name any countries but stressed that he would be the one to determine the terms. 'I set the deal — they don't set the deal,' he remarked. When asked if any trade deals were imminent this week, Trump said, 'It could very well be.' However, when asked to elaborate on a timeline, he did not provide clarity, stating, 'At some point in the next two weeks or three weeks, I'm going to be setting the deal.' Trade talks underway, but Trump's tariff threat looms Discussions have already been underway between Trump's aides and several other countries. However, Trump also maintained that new duties could still be imposed, saying, 'At a certain point, I'll be just setting a certain tariff number.' 'I'm going to say that such and such a country has had a tremendous trade surplus — surplus their way — with us, and they've taken advantage of us in various ways, and we fully understand what they were doing,' he added. Trump's sweeping tariffs, announced on April 2, have triggered major upheavals in global markets in recent weeks, with fears of a global economic slowdown mounting. Within the US, concerns about a potential recession have also grown. Last week, data from the US Bureau of Economic Analysis, cited by Bloomberg, revealed that the country's gross domestic product (GDP) had contracted for the first time in three years. The economic headwinds may have intensified pressure on the Trump administration to secure quick trade wins. Are the US and India nearing a trade agreement? India has been subjected to tariffs of up to 26 per cent. The Indian government has been engaged in trade talks with the US over a possible bilateral trade agreement. US Vice-President JD Vance recently visited India and held discussions with Prime Minister Narendra Modi, fuelling speculation that a deal may be close. US-China trade talks may begin soon China — the primary target of Trump's tariff campaign — said last week it is evaluating messages sent by the US government expressing a desire to resume trade negotiations. 'The US has recently sent messages to China through relevant parties, hoping to start talks with China,' China's Commerce Ministry said in a statement on Friday. 'China is currently evaluating this.' Beijing has been hit with import duties of 145 per cent, with tariffs reaching up to 245 per cent on some goods. While Trump said on Sunday that he does not currently plan to speak directly with Chinese President Xi Jinping, he suggested his administration may be open to scaling back tariffs as part of future negotiations.
