The White House says negative GDP for the second consecutive quarter is unlikely to indicate a recession

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The White House Economic Advisory Board said on July 21 that even a negative pre-estimate of GDP on Friday would be “unlikely” to indicate that the country is in recession.

A recession is the second consecutive quarter of negative economic growth.

In a blog post, the Economic Advisory Board states that just because GDP has fallen for two consecutive quarters does not mean that the country is in recession.

“What is a recession? Some argue that a decline in real GDP for the second consecutive quarter constitutes a recession, but it is neither an official definition nor a way for economists to assess the state of the business cycle.” Said the blog post.

Treasury Janet Yellen acknowledges economic “slowdown” but downplays concerns about recession

President Joe Biden talks about the final rules for implementing the US Relief Program Special Financial Assistance Program to protect the economy and multi-employee pension plans at Max S. Hayes High School in Cleveland, Ohio, on July 6, 2022. increase. ((Photo by SAUL LOEB / AFP via Getty Images) / Getty Images)

Citing figures from the National Bureau of Economic Research, the post states that their “recession indicator variables” “have shown strong growth in the U.S. economy since the start of the pandemic and have continued to expand until the first half of this year.” increase.

Even if the economic analysis agency’s preliminary estimate of GDP in the second quarter shows a negative number, the country may not be in recession, according to a blog post.

“Based on these data, the decline in GDP in the first quarter of this year is unlikely to indicate a recession, even if another decline in GDP continues in the second quarter,” the post said. ing.

Meanwhile, inflation surged to a 40-year high in June, reaching 9.1%.

In NBC News’ Meet the Press, Treasury Secretary Janet Yellen said the economy was not in recession, but in a “slowing growth” and “transitional period.”

The U.S. has seen 13 months of soaring costs since Biden’s managers called inflation a “transition.”

Treasury Secretary Janet Yellen will testify at the Houseways and Means Commission on Capitol Hill on June 8, 2022. (AP Photo / JoseLuis Magana, File / AP Newsroom)

“Currently, the labor market is very strong,” Yellen said. “This is not a recessionary economy, but we are in a transitional period of slowing growth. It needs to grow at a steady and sustainable pace, which is necessary and appropriate. Therefore, there is a slowdown. And companies can understand that, and given that people are working now and we have a strong labor market, that’s appropriate. “

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Republican National Committee spokesman Will O’Grady told FOX Business that “redefining” what a recession is would not amend some of the legislative measures taken by the Democratic Party. ..

“Joe Biden has probably turned the recovery into a recession. Redefining the language cannot correct the fact that Democrats wereted $ 1.9 trillion and Americans’ costs soared.” Said.