The newly released figures show 0.1% growth in the June quarter. The March figure was also revised up to -0.8% (from -1.0%).
Here comes the sun? Not quite. 0.1% is pretty damn weak. It’s below population growth (0.25% per quarter) so, we’re still worse off per person. And we’re a long way below the economic peak reached in the December 2007 quarter. Seasonally-adjusted GDP was 2.8% below peak in the June quarter and 4.2% per person below the peak. We’ve got a long way to go to get back to that level.
Unemployment is still rising and will continue to rise for at least a year, while wages are stagnating and set to fall in real terms. It will be some time before ordinary people feel any benefit from the return to growth.
On top of that, a growing body of economists are predicting this is a w shaped recession, and we’re just on the little rise in the middle resulting from government stimulus and a temporary return of confidence to the international markets. The fundamental problems that caused the recession (commodity prices including oil, housing bubbles, toxic financial assets, trade imbalances) remain unresolved, there is trouble still to come for the US exchange rate, government balance sheets are stretched, and there are indicators of trouble ahead – like falling money supply in the US.
So, yay, the recession’s technically over. But don’t break out the champagne just yet.