In a pattern similar to that of the previous year, the U.S. economy appeared to slow down this past winter. The Bureau of Economic Analysis currently estimates that gross domestic product (GDP) grew at 0.6% (at an annualized rate) in the first quarter of 2015. And as in the previous year, harsh winter weather has been cited by some observers as being responsible for the slowdown. However, there is substantial disagreement on the impact of weather on economic activity.
Indeed, many other factors may have been at play last winter, including the sharp decline of oil prices and the appreciation of the dollar relative to other currencies, as well as more idiosyncratic factors, such as strikes in the West Coast ports. Moreover, some have questioned the accuracy of the seasonal adjustment procedure of the Bureau of Economic Analysis. This Chicago Fed Letter provides estimates of the effect of weather on measures of economic activity during the past winter.
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