Economy Shrinks in Second Quarter, But Less Than Expected

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The Commerce Department said today that the nation’s gross domestic product, or total goods and services produced, contracted in the second quarter at an annual pace of 1%. This marked a dramatic improvement from a decline of 6.4% and 5.4% recorded in the prior two quarters, and provided the latest evidence that the economy will start growing again shortly after entering recession in December 2007. [...]

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Economists, who were expecting GDP to be down about 1.5% in the last quarter, were heartened by the new statistics. GDP is the broadest measure of economic activity.

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“This report signals that the recession is quickly coming to an end and the subsequent recovery will be modest but better than I had thought before today’s numbers,” said Mark Zandi, chief economist at Moody’s Economy.com.