Last week, the third-quarter gross domestic product (GDP) numbers came out and they were slightly better than expected. They were not great, but they were OK. During the July-to-September period, the United States economy expanded at a 1.9 percent annualized rate, beating the median estimate of 1.6 percent. This suggests that the economy is not slowing as quickly as many investors anticipate.
Is the country in the clear? Not quite.
The Atlanta Federal Reserve’s GDPNow forecast model recently showed that the economy could potentially grow at a 1.1 percent annualized clip in the fourth quarter.
The biggest driver of weakness? Manufacturing, thanks to the horrendous trade war.
The Atlanta Fed said in a statement:
“After this morning’s release of the employment report by the U.S. Bureau of Labor Statistics, the Manufacturing ISM Report On Business from the Institute for Supply Management, and the construction spending report from the U.S. Census Bureau, the nowcasts of fourth-quarter real personal consumption expenditures growth and fourth-quarter real gross private domestic investment growth decreased from 2.3 percent and -0.7 percent, respectively, to 2.2 percent and -2.5 percent, respectively.”
Is it any wonder why President Donald Trump is demanding low interest rates?
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