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| Version 5 | Version 6 |
|---|---|
| US economic growth stays positive | US economic growth stays positive |
| (about 3 hours later) | |
| The US economy has been boosted by the government's $168bn (£84bn) stimulus package, according to the US Treasury Secretary Henry Paulson. | The US economy has been boosted by the government's $168bn (£84bn) stimulus package, according to the US Treasury Secretary Henry Paulson. |
| Official figures showed that gross domestic product (GDP) rose at an annual rate of 1.9% between April and June, up from 0.9%. | Official figures showed that gross domestic product (GDP) rose at an annual rate of 1.9% between April and June, up from 0.9%. |
| Mr Paulson predicted that the US economy would get stronger next year "and beyond". | Mr Paulson predicted that the US economy would get stronger next year "and beyond". |
| The figure was worse than expected and caused shares to fall. | |
| The benchmark Dow Jones index closed more than 200 points, or 1.78% lower at 11,378.02 points. | |
| Investors were also concerned that the government had downgraded its estimate of growth in the last three months of 2007 from the previous reading of 0.6% to show a negative growth figure of -0.2%. | Investors were also concerned that the government had downgraded its estimate of growth in the last three months of 2007 from the previous reading of 0.6% to show a negative growth figure of -0.2%. |
| The US dollar fell across the board, including against the euro and the yen, following the release of the data. | The US dollar fell across the board, including against the euro and the yen, following the release of the data. |
| At the current growth rate of nearly 2%, the US economy is only growing at half the rate it was one year ago. | At the current growth rate of nearly 2%, the US economy is only growing at half the rate it was one year ago. |
| 'Timely' stimulus | 'Timely' stimulus |
| We're in a recession. I don't know how they get the 1.9% [figure] in the second quarter Robert Macintosh, chief economist, Eaton Vance Management | We're in a recession. I don't know how they get the 1.9% [figure] in the second quarter Robert Macintosh, chief economist, Eaton Vance Management |
| "Clearly the stimulus plan has supported the US economy during this difficult period and couldn't have been timelier," said US Treasury Secretary Henry Paulson. | "Clearly the stimulus plan has supported the US economy during this difficult period and couldn't have been timelier," said US Treasury Secretary Henry Paulson. |
| Without that extra government spending, which added almost 4% to the economy that quarter, it is feared that growth would have been negative. | Without that extra government spending, which added almost 4% to the economy that quarter, it is feared that growth would have been negative. |
| Analysts are now concerned about what will happen to the US when the benefit of the stimulus package, which gave tax rebates to 130 million households, has passed. | Analysts are now concerned about what will happen to the US when the benefit of the stimulus package, which gave tax rebates to 130 million households, has passed. |
| The US Treasury Secretary Henry Paulson said he expects the economy to continue growing this year and "to return to stronger growth next year and beyond". | The US Treasury Secretary Henry Paulson said he expects the economy to continue growing this year and "to return to stronger growth next year and beyond". |
| However, other international organisations such as the International Monetary Fund have argued that the economy will continue to slow further until 2010. | However, other international organisations such as the International Monetary Fund have argued that the economy will continue to slow further until 2010. |
| Jobless claims rise | Jobless claims rise |
| Some economists believe that the US is already in a recession and the latest unemployment figures have compounded that belief. | Some economists believe that the US is already in a recession and the latest unemployment figures have compounded that belief. |
| Figures from the Department of Labor showed that the number of applications for unemployment benefit last week hit a five-year high. | Figures from the Department of Labor showed that the number of applications for unemployment benefit last week hit a five-year high. |
| Jobless claims reached 448,000, an increase of 44,000 from the previous week. | Jobless claims reached 448,000, an increase of 44,000 from the previous week. |
| "I think the most troubling thing out of all the numbers this morning is the (jobless) claims number. If that doesn't convince people we're in a recession, then nothing will," said Robert Macintosh, chief economist at Eaton Vance Management in Boston. | "I think the most troubling thing out of all the numbers this morning is the (jobless) claims number. If that doesn't convince people we're in a recession, then nothing will," said Robert Macintosh, chief economist at Eaton Vance Management in Boston. |
| The most common definition of a recession is two consecutive three-month periods of negative growth. | The most common definition of a recession is two consecutive three-month periods of negative growth. |
| Officially in the US, a recession has not taken place until the National Bureau of Economic Research says this is the case, but this decision may not come for two years. | Officially in the US, a recession has not taken place until the National Bureau of Economic Research says this is the case, but this decision may not come for two years. |
| "We're in a recession," said Mr Macintosh. "I don't know how they get the 1.9% [growth figure] in the second quarter." | "We're in a recession," said Mr Macintosh. "I don't know how they get the 1.9% [growth figure] in the second quarter." |