The US economy grew in the first quarter of this year by only 0.2%. Almost zero growth is likely to force the Fed to delay raising interest rates at least until the end of the year. The US administration will increase the pressure on its partners in Europe and the Pacific region in order to establish free trade zones.
In the first quarter of 2015, the US GDP increased only by 0.2%, while in the fourth quarter of the last year, the growth was of 2.2%, and in the third one - 5%. Analysts had expected growth in the range of 1-1.3%.
The US entered a trap that was generated by a group of local factors, some of which were the result of their own policy: reduced oil prices, a strong dollar, cold winter and a strike of dockworkers in the ports of the West Coast. Fallen oil quotes were believed to affect mainly Russia, but the results of the first quarter show that the US is also suffering from low-cost hydrocarbons.
The US exports in the first quarter fell by 7.2% and the imports rose 1.8%. The foreign trade figures were significantly influenced by a strong dollar, which makes US goods less competitive than imports. The continuous growth of consumption spending can be a consolation. It increased by 1.9%. However, analysts were waiting for a more significant growth (4.4%).
The results of the first quarter will lead to several consequences. Firstly, the US Federal Reserve is likely to postpone the increase of the rates for the end of the current year, or even the next year. On Thursday, the Operations Committee on the Federal Open Market (FOMC) left the rates unchanged at minimum level of 0-0.25%.
Another, more global effect of the poor first quarter, which demonstrated the volatility of growth in the US economy, will be an increased pressure on external partners. Currently, the USA is promoting two global projects in the economic field - a free trade zone with the European Union (Transatlantic Trade and Investment Partnership, TTIP) and another with the Pacific region countries. The Trans-Pacific Partnership is to include the Asian countries, as well as the United States and Latin America.
In this situation, supporting the external economic policies and decisions, Obama declared that: “If we do not write the rules, then China will make it. We will be forced out of the agriculture market, causing problems to our businesses, which will lead to job losses".