new federal report shows increased consumer spending shoring up gross domestic product growth
Third quarter increases in consumer and government spending, along with housing investment growth, provided fuel for a 1.9 percent improvement in the nation’s Gross Domestic Product, says a new government report.
While the numbers are on the plus side, the report issued by the Department of Commerce’s Bureau of Economic Analysis also notes that the 1.9 increase was lower than the numbers from April to June of this year which saw a 2.0 percent increase.
The latest figures, according to the BEA, also indicate a significantly more modest increase in personal income this past summer, over the second quarter of the year. The most recent numbers pegged the third quarter increase in personal income at $172 billion, down from the spring increase of $244 billion.
At the same time, spending on durable goods was up by 7.6 percent over the previous quarter, with business investment in intellectual property increasing by 6.6 percent.
Although the most recent Gross Domestic Product numbers remain strong, the trend throughout most of 2019 has been in a downward direction: “The year started out with a surge, but the pace of growth declined in the spring and again over the period that spanned July, August, and September,” observed the New York Times.
Even so, asserted Business Insider, the third quarter increase in consumer spending is nothing to sneeze at: “Households have remained one of the brightest spots in an economy faced with a flurry of strains, including steep tariffs on an increasing number of products.”
While the third quarter report is short of the Trump Administration’s earlier pledge to keep growth at the level of 3 percent or above, Commerce Secretary Wilbur Ross, in a statement, said the latest numbers showed that the “U.S. economy continues its steady growth in defiance of media skeptics calling for a recession.”
By Garry Boulard
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