EconomyThe growth of the US economy revised upwards to 5.2%

The growth of the US economy revised upwards to 5.2%

Gross Domestic Product (GDP) expanded at an annualized rate of 5.2%

According to the Commerce Department’s second estimate, the Gross Domestic Product (GDP) expanded at an annualized rate of 5.2% from July through September. This figure surpasses the department’s initial estimate of 4.9% and reflects increased business investment, government spending, residential investment, and inventory growth.

Nonresidential fixed investment, or business spending, saw an upward revision to a growth rate of 1.3%, reversing a previous decline. Residential investment, indicative of housing market conditions, was significantly revised upward to 6.2% from 3.9%. While consumer spending, a vital driver of the US economy, was slightly lower at 3.6%, down from the initial estimate of 4%, it still reflects a solid growth pace.

Despite a robust third quarter, economic experts anticipate a slowdown in the year’s final months. Factors such as diminishing pandemic savings and persistently high-interest rates, the highest in 22 years, contribute to expectations of a deceleration in growth. Recent economic indicators, including a decline in retail sales in October and slowing activity in both the services and manufacturing sectors, suggest a potential economic slowdown.

Although consumer spending appears strong with record-setting Black Friday and Cyber Monday sales, there are concerns about a cooling job market.

Employers added 150,000 jobs last month, below expectations, and real-time estimates project a slower fourth-quarter GDP growth rate. Economists caution that despite evidence of economic strength, challenges such as rising costs, increased debt burdens, and slowing job growth could dampen consumer and business spending.

The Federal Reserve, closely monitoring various facets of the US economy, is expected to maintain interest rates at their current 22-year high during its upcoming December 12-13 policy meeting.

Some officials, like Fed Governor Christopher Waller, express confidence that current policy measures are well-positioned to address inflation and moderate economic growth. However, there are differing opinions within the Fed, with Governor Michelle Bowman advocating for further rate increases to promptly bring inflation down to the 2% target. The economic landscape remains dynamic, with uncertainties about the growth trajectory and the appropriate policy response.

Nathan Enzo
Nathan Enzo
A professional writer since 2014 with a Bachelor of Arts in Journalism and Mass Communication, Nathan Enzo ran the creative writing department for the major News Channels until 2018. He then worked as a Senior content writer with, including national newspapers, magazines, and online work. He specializes in media studies and social communications.


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