Strong upswing: US economy is booming despite Omikron

As of: 01/27/2022 5:05 p.m

The world’s largest economy was able to recover quickly from the slump at the beginning of the pandemic last year. Recently, the US economy has even received an additional boost.

The US economy grew 5.7 percent last year, the strongest since 1984. This was announced by the Department of Commerce based on an initial estimate. The growth was particularly driven by increased consumer spending, fixed asset investment, exports and investment in inventories, it said.

A year earlier, the US economy had collapsed due to the Corona crisis, and gross domestic product had shrunk by 3.5 percent at the time. The economic output of the United States reached almost 23 trillion dollars in 2021. In 1984, the economy had grown by an even stronger 7.2 percent.

High inflation as a result

According to the Department of Commerce, the US economy grew at an annualized rate of 6.9 percent in the fourth quarter of 2021. In view of increasing demand, many companies replenished their inventories, which had been thinned out during the pandemic, which gave the economy a boost.

When US growth figures are annualized, they are not directly comparable to European data. The details of the first estimate can also be corrected later.

The upswing was accompanied by a sharp rise in inflation, which recently reached seven percent over the year. At the same time, the unemployment rate fell to 3.9 percent. The US Federal Reserve only spoke of “full employment” in the country on Wednesday. Because of the booming economy, the Federal Reserve could raise interest rates five times in the current year.

Leave a Reply

Your email address will not be published.