Winter storms blasted half a percentage point from U.S. economic growth in Q1 2015, making it the second year in a row that weather hammered the economy during the first quarter, according to a survey of economists by Bloomberg.
Just under half of the 37 economists surveyed said the frigid temperatures and snow that blanketed the eastern part of the U.S. in February were to blame for GDP growth that fell to a 1.5 percent annualized rate, after growth hit 2.2 percent in Q4 2014.
The rest of the economists pointed to other factors, including lower energy prices, slow wage growth, business inventory volatility and supply delays caused by a labor dispute at West Coast ports, as well as weaker global growth and a strong dollar.
However, winter was the most likely culprit for retail sales that fell in January and February, manufacturing that fell off and residential construction that weakened. Americans in 23 states experienced one of 10 coldest Februarys since 1895, according to National Oceanic and Atmospheric Administration data. Boston saw its snowiest month on record, with record-low February temperatures in Chicago, Buffalo and Cleveland.
But like the start of 2014, when weather helped the economy shrink at a 2.1 percent rate, the slowdown should thaw soon. “We’ll see a very weak first quarter like we did last year, but second and third quarters should be very, very strong,” Moody’s Analytics senior economist Ryan Sweet told Bloomberg, which called Q1’s economic data the most disappointing in years.
Growth should jump to 3 percent in Q2, a separate Bloomberg survey of 75 economists last month predicted.
That increase already began to show up in vehicle sales numbers for March. Cars and light trucks sold at a 17.1 million annualized rate, slightly better than the 16.9 million rate that analysts had forecast for March, and up 5.5 percent from February’s 16.2 million rate, according to industry data released this week.