An economy is the amount of money made and used in a particular country or region. The United States is the world’s biggest economy, accounting for roughly 16% of the global economy. The European Union, which is made up of 27 European countries, is the world’s biggest economic region, accounting for 17% of the world’s economy.
Economics look at a number of factors when considering the relative strength of an economy. One of the main considerations is the gross domestic product (GDP). GDP is a measure of all the goods and services produced in an economy and it is generally calculated on a quarterly and annual basis.
Sustained economic growth positively impacts income, employment levels, consumption, and the overall standard of living. In a strong or growing economy, businesses increase their sales, hire more people, are more confident about the future, and invest more in their companies. Consumers earn more, are more optimistic about the future, and spend more.
In the years leading up to the 2008 financial crisis, the U.S. reported annual GDP growth of around three percent. Since the 2008 and 2009 recession, U.S. GDP has been more subdued at around 2.2%.
When considering the strength of an economy, economists also look at inflation, interest rates, jobs growth, consumer demand, population growth, standard of living, and social and political factors.
By measuring this data on an annual basis, economists can determine if an economy is expanding or contracting. An economic analysis can also help investors get a general idea of market conditions and possible trends.
Fed Sees Gradual Rate Rise as Appropriate The U.S. dollar rose against major currency pairs Friday, strengthened by Federal Reserve Chairwoman Janet Yellen’s remarks that an interest rate increase might come earlier than expected. The Wall Street Journal Dollar Index.
Corporate Profits Increase in Second Quarter U.S. economic growth in the second quarter slowed more than earlier reported, according to the latest report from the U.S. Department of Commerce. On Friday, the Commerce Department announced that gross domestic product (GDP).
Claims Below 300,000 for 77 Consecutive Weeks Recent economic indicators have been pointing to a strengthening labor market in the U.S., and the latest one does not disappoint. Thursday saw the U.S. Department of Labor release its weekly report on.
Biggest Monthly Gain Since October 2015 After an unexpected drop in June, U.S. durable goods orders bounced back in July. On Thursday, August 25, the U.S. Department of Commerce released the latest report on durable goods. It showed that in.
First Year-Over-Year Decline Since November 2015 While new home sales soared to an eight-year high in July, data on existing home sales is telling a different story. On Wednesday, August 24, the National Association of Realtors reported that total existing.
Investors Await More Clues on Rate Direction The U.S. dollar reversed its yesterday’s decline against a basket of currencies on Wednesday, amid a mixed set of economic data which showed strengthen in a segment of the housing market. The Wall.
Slower Revenue, Increasing Spending Fueling Deficit The U.S. budget deficit for the fiscal year 2016 is expected to surpass the earlier forecast and should settle at 3.2% of the gross domestic product, according to the Congressional Budget Office’s (CBO’s) latest.
Markit Flash PMI at 52.1 in August, Down from 9-Month High in July July was a solid month for the U.S. manufacturing sector. An advance estimate from IHS Markit suggests that expansion continued in August, albeit at a slower pace..
Sales of New Single-Family Houses Reach Highest Level Since 2007 Recent economic indicators have been saying positive things about the U.S. economy. New home sales is the latest one to add to that list. On August 23, the U.S. Department.
Wealth Inequality on the Rise A tiny fraction of Americans controls a majority of the nation’s wealth, according to a recent report from the U.S. Congressional Budget Office (CBO). More specifically, the bottom half of the population collectively owns a.