The U.S. gross domestic product (GDP) grew in the second quarter of 2010, but the pace was the slowest in a year, according to the latest Weekly Chemistry and Economic Trends report from the American Chemistry Council (ACC; Arlington, Va.; www.americanchemistry.com).
In assessing the week’s economic information, ACC cited Bureau of Economic Analysis data that suggest the GDP grew by an annual pace of 2.4% during the second quarter of 2010, down from the 3.7% and 5.0% annual pace of GDP growth, respectively, for the two previous quarters.
The lower rate of growth in U.S. GDP is reflected in the chemical industry, where individual product reports for polymers and other products confirm that while recovery has occurred over the past year, the pace is slowing. And general industrial activity paints a consistent picture, ACC says.
“Overall industrial activity appears to be downshifting,” ACC says, at the end of a year-long expansion of activity and restocking to align output with demand. That restocking, also known as inventory bounce, “is now dissipating,” the ACC report states.
The ACC report points out that the slowing in manufacturing activity at this point in the business cycle is somewhat normal. In the past, such early-cycle downshifts have been followed by reaccelerating growth, ACC points out, but it remains to be seen whether that will occur, because of the fragility of the economic recovery.
Citing data from other sources, ACC says consumer confidence levels remain “dismal” and orders for durable goods fell. However, the number of people filing initial claims for unemployment is down.