A second reading of the U.S. economy in the second quarter reflected the biggest quarterly plunge in activity on record, though the Covid-induced plummet wasn’t as bad as initially estimated.
Gross domestic product from April to June tanked 31.7% on an annualized basis, according to the Commerce Department’s second reading released Thursday. That was revised down from the 32.9% initial estimate of the damage the pandemic-fueled lockdowns had on the economy in the second quarter.
Economists surveyed by Refinitiv had expected a decline of 32.5%.
Even with the revision, it was still the worst contraction in the economy ever recorded. The drop in GDP was more than triple the previous all-time decline. The economy contracted at a 5% pace in the first quarter.
The economy fell into recession in February.
After-tax profits without inventory valuation and capital consumption adjustment, which correspond to S&P 500 profits, dropped at a rate of 11.7%. Profits decreased at a pace of 13.1% in the first quarter.
When measured from the income side, the economy contracted at a 33.1% rate in the last quarter. Gross domestic income (GDI) declined at a rate of 2.5% in the January-March period. The average of GDP and GDI, also referred to as gross domestic output and considered a better measure of economic activity, decreased at a 32.4% rate last quarter. That compared to a 3.7% pace of decline in the first three months of the year.
—Reuters contributed to this report.