(Updates EC3487 with more data and statement from Biden)
WASHINGTON, Oct. 30 (.) – U.S. gross domestic product (GDP) grew 0.7% in the third quarter of 2024, compared to the second quarter recorded, according to data from the Bureau of Economic Statistics (BEA). It was the same number. ) Wednesday’s announcement confirms the country’s economic strength with just six days left until the election.
Meanwhile, the first GDP estimates showed annual growth of 2.8% in the July-September period, slowing compared to the 3% figure recorded in the previous quarter.
The BEA notes that while consumer spending, exports, and federal spending increased during this period, imports subtracted from GDP calculations increased.
The statistics dispel fears of an economic recession and confirm the strength of the U.S. economy, with just six days left until the November 5 presidential election between Democrat Kamala Harris and Republican Donald Trump. It became.
President Joe Biden said in a statement that GDP statistics show progress since taking office.
“From the worst economic crisis since the Great Depression to the strongest economy in the world. Since I took office, the economy has grown 12.6%, the average unemployment rate is the lowest in 50 years, and about 16 jobs have been lost to hundreds of 10,000 jobs and incomes increased by $4,000 above inflation,” he said.
Despite the slight slowdown, the annual growth rate was higher than economists expected, a fact known at the time the Federal Reserve began its rate-cutting cycle, with current interest rates at 4.75%. In the range of 5% to 5%.
All this after inflation fell (2.4% in September, the latest known data) and the labor market remained strong with 254,000 jobs created in September.
The first rate cut will take place in mid-September, and members of the interest rate committee will meet next week on November 6 and 7 to consider whether further rate cuts are appropriate.
According to forecasts, a 25 basis point decline is likely, but knowing the economy is stable makes that more likely.
A closer look at GDP data shows that the increase in consumer spending reflects an increase in both goods and services. BEA noted that merchandise growth was driven by other nondurable goods (primarily prescription drugs) and motor vehicles and parts (primarily used light trucks).
Growth in consumer spending on services was driven by health care (primarily outpatient services) and food and accommodation services.
The increase in exports mainly reflects the increase in goods (led by capital goods, excluding automobiles), and the increase in imports mainly reflects the increase in goods (led by capital goods, excluding automobiles).
The increase in federal government spending primarily reflects increases in defense-related consumer spending.
Compared to the second quarter, the slower annual pace of GDP in the third quarter primarily reflects a decline in private inventory investment and a further decline in housing fixed investment.
These developments were partially offset by acceleration in exports, consumer spending, and federal spending. Meanwhile, imports accelerated.
The report also revealed that the gross domestic product (GDP) price index rose 1.8% in the July-September period, slowing from the 2.5% rise recorded in the previous quarter.
Meanwhile, the basic personal consumption expenditure index rose 2.2% in the quarter, lower than the 2.8% growth recorded in the second quarter, but above the expected 2.1% rise.
