"I do not think the US is currently in a recession," Powell said earlier this week. "There are just too many areas of the economy that are performing too well."

But GDP doesn't just turn negative on its own, and Thursday's data contains useful guidance for understanding a complex economic moment.

Pay attention: Inventories, or goods held by a business that haven't been sold yet, had a major role to play.

Companies stocked up on many items late last year as they attempted to dodge supply chain problems and ensure they could meet resurgent demand.

But in recent months, they've realized they have too much stuff, especially at an uncertain moment for manufacturers and shoppers, and become hesitant to place new orders.

The subsequent slowdown in inventory accumulation contributed to a large chunk of the contraction between April and June, removing a whopping two percentage points from economic output.

"I do not think the US is currently in a recession," Powell said earlier this week. "There are just too many areas of the economy that are performing too well."

But GDP doesn't just turn negative on its own, and Thursday's data contains useful guidance for understanding a complex economic moment.

Pay attention: Inventories, or goods held by a business that haven't been sold yet, had a major role to play.

Companies stocked up on many items late last year as they attempted to dodge supply chain problems and ensure they could meet resurgent demand.

But in recent months, they've realized they have too much stuff, especially at an uncertain moment for manufacturers and shoppers, and become hesitant to place new orders.

The subsequent slowdown in inventory accumulation contributed to a large chunk of the contraction between April and June, removing a whopping two percentage points from economic output.