The Shivers: America's Shrinking Economy

America’s economy probably shrank in the first quarter of 2015. Revised GDP data, due today, are likely to indicate that it contracted at an annualised rate of 0.8% (the first guess, published last month, showed a tiny increase). There are plenty of signs that the economy is struggling. In recent months retail sales have stumbled, and corporate profits have been on a downward trend. But fears of another recession may be overblown. The way that American statisticians adjust GDP figures for seasonal influences may be one problem: in the past few years first-quarter growth has averaged 0.6% (again, annualised); the remaining three quarters have clocked up 3%. Janet Yellen, the head of the Federal Reserve, also ascribes this year’s first-quarter droop “largely” to temporary factors, such as a severe winter in parts of the country and a labour dispute at West Coast ports.