U.S. GDP Grows 2.1% as Q1 Profits Rise $74.4 Billion and Wages Trail 4.2% Inflation
Updated
Updated · The Racquet · Jul 23
U.S. GDP Grows 2.1% as Q1 Profits Rise $74.4 Billion and Wages Trail 4.2% Inflation
2 articles · Updated · The Racquet · Jul 23
Summary
Q1 data show a split economy: corporate profits rose $74.4 billion and GDP expanded at a 2.1% annualized rate, even as wage growth of 3.82% failed to keep up with 4.2% inflation.
That growth was driven by investment, exports and government spending, while consumer spending was revised down—signaling households were not powering the expansion.
April savings fell to 2.6% of after-tax income, an extreme low, leaving spending increasingly supported by depleted savings and more borrowing.
Household pressure remains concentrated in essentials: rent is about 41% above pre-pandemic levels, and gasoline climbed to roughly $4.79 a gallon after the Iran war.
The report frames the pattern as a K-shaped economy, with returns to ownership—stocks, property and businesses—outpacing income from work.