Wednesday, February 8, 2023

United States GDP grows even more in third quarter

growth of Gross Domestic Product From America It was revised up to an annualized rate of 3.2% in the third quarter, according to the most recent estimate published by the U.S. on Thursday. Commerce department,

The first estimate had put the growth in the economy at 2.6% for that period, and the previous revision had already raised it to 2.9%.

The department thus confirmed that the economy improved in the third quarter after contracting in the first half of the year.

Compared to the previous quarter, the US economy grew 0.8%, similar to other advanced economies, compared to an initially estimated 0.6%.

growth of Gross Domestic Product Growth is reflected in exports, consumer spending, non-residential fixed investment, state and local government spending, and government spending. federal government, That was partially offset by declines in residential fixed investment and personal inventory investment, according to the department’s report.

Household consumption between July and September was higher than initially estimated, as was non-residential fixed investment Commerce department,

However, the decline in the housing market was deeper than previously estimated, with residential investment contracting for six consecutive quarters, the longest period since the 2006 housing market collapse.

Out of 22 industries, 16 contributed to the return to industry Gross Domestic Product, led by information, professional, scientific and technical services as well as mining, retail and real estate, rental and leasing. Construction subtracted the largest share of GDP, followed by utilities and the finance and insurance industries.

Gross Domestic Product Contracted during the first two quarters of the year, at an annualized rate of 1.6% and 0.6%, respectively. However, the government does not believe that the United States is in a recession.

Although it has declined for two consecutive quarters Gross Domestic Product While they do not fit the technical definition of a recession, the strength of the labor market in particular does not make it possible to argue that this is the case in the world’s largest economy.

Growth forecast for the fourth quarter is on track for a 2.7% pace, with consumers hitting hard, also supported by savings accumulated during the pandemic.

Adjusted for inflation, available household income rose for the first time in a long time in the third quarter as price pressures eased. Business spending on equipment also remains flexible.

Nevertheless, a recession next year is more likely as a strong labor market increases the likelihood of further rate hikes, further reducing household wealth, which is being affected by declining stock markets and housing prices. Consumers are also draining their savings and a stronger dollar will hurt exports.

“We expect a mild recession beginning in the spring of 2023,” said Gus Faucher, chief economist at PNC Financial. Pittsburgh, Pennsylvania,

Rubella Farooqi, HFE’s chief cabinet economist, does not expect the economy to shrink.

“Despite a rapid increase in interest rates, the economy is growing and most importantly, households continue to spend. However, between now and 2023, we expect slower growth, although we expect activity to contract. Let’s hope not,” Farooqui said.

The US central bank has raised interest rates since March to reduce high levels of inflation.

Nation World News Desk
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