Gross domestic product (GDP)—the broadest of the economic measures—contracted (again!), according to revised data out this morning. An earlier reading showed positive growth—barely. All the red-ink cross-outs are testament to how volatile early 2015 was for U.S. growth, plagued by weather, a major port closure, and other factors. Wall Street could be choosing to live in the present. A MarketWatch survey of industry economists shows a consensus GDP reading at 3.2% for our current Q2. Perhaps we’re in store for a status quo day. Participants may be reluctant to make big moves ahead of closely watched job-market data due out next week.
Contraction. The U.S. economy’s ability to reach 3% growth for all of 2015, as many industry economists are predicting, looks increasingly challenging. GDP is the value of everything a nation produces. And for the U.S., it contracted by 0.7% at an annual rate from January to March, the Commerce Department said Friday. The government originally had reported a tepid 0.2% increase in Q1 GDP. According to MarketWatch, the big markdown resulted from a smaller inventory build and higher imports than preliminary data showed. Consumers, for their part, spent at moderate rate and businesses cut overall investment except in residential housing.
Greece Fears Percolating. Greece and its creditors had downplayed imminent debt risk earlier this week when they expressed confidence in deal progress before Sunday’s deadline. But the rest of Europe, and its investors, aren’t quite convinced. Europe’s major stock averages fell again Friday. The International Monetary Fund’s Christine Lagarde told a German newspaper that Greece may have to exit the euro-zone but that won’t spell an end to the shared currency.
Payrolls on Tap. All eyes again turn to next Friday’s release of monthly jobs data. This time May data is on tap. The MarketWatch consensus calls for a gain of 218,000 payrolls this month, nearly on pace with the 223,000 new jobs reported for April. The unemployment rate is expected to hold at 5.4%, while average hourly earnings growth could heat up to 0.3% from April’s 0.1% gain.