In the third quarter of the current year, the United States economy maintained strong growth rates.
The mentioned result is largely due to a decrease in inflation and a significant increase in wages, which contributed to a rise in consumer spending ahead of the US presidential election scheduled for next week. It is worth noting that the subsequent political situation in the country may become a factor of fundamental impact on financial circumstances.
The gross domestic product (GDP) of the United States in the third quarter of 2024 showed growth of 2.8% compared to a year ago. The relevant information was published by the US Commerce Department’s Bureau of Economic Analysis on Wednesday, October 30. In this case, it means the advance estimate of the mentioned indicator.
It is worth noting that analysts interviewed by the media predicted that the GDP of the United States would grow by 3% in the third quarter of the current year It is worth noting that in this case, an average estimate is implied.
In the second quarter of the current year, the GDP of the United States grew by 3%.
US President Joe Biden positively assessed the new data on the condition of the country’s economic system. On Wednesday, he said that the GDP report shows significant progress since he took office in January 2021. According to Joe Biden, during the corresponding period, the path was passed from the worst crisis since the Great Depression to the strongest economy in the world.
A White House official on a call with reporters on Wednesday said that under the current presidential administration, average annual economic growth in the United States has been stronger than under any other administration this century.
The International Monetary Fund predicts that in the fourth quarter of 2024, US GDP will increase by 2.5%. It is worth noting that the experts of this organization have revised the corresponding forecast for improvement. The expected figure is the largest among the economies of the Group of Seven countries.
James Bullard, former president of the Federal Reserve Bank of St. Louis, said during a conversation with media representatives this month that there are sufficient arguments in favor of announcing the already begun implementation of a soft landing scenario in the United States economy.
It is worth noting that, despite the upward dynamic of GDP, consumer sentiment in the US continues to be less optimistic than before the coronavirus pandemic. According to media reports, some experts explain the corresponding mood by the fact that currently in the United States, the cost of goods and services is higher than in 2019 when the global economic reality has not yet faced the extreme circumstances and conditions associated with the mentioned disease.
The last few years have been a period of struggle for the US economic system against the rapid rise in prices. In 2022, inflation in the United States reached its peak in the last few decades at 9.1%. The Federal Reserve System, as part of the implementation of an aggressive monetary policy that provides for a significant increase in interest rates, has been able to make progress in countering rising prices for goods and services. In September of the current year, inflation in the United States was fixed at 2.4%. Also, last month, the Fed began to ease monetary policy, which is an unambiguous and clear signal that the financial regulator is stating a kind of turning point in countering the rise in prices for goods and services. At the same time, something like the effects of the traumatic experience of a period of high inflation is still being observed in the United States nowadays. The country’s economy is on an upward trajectory, but the shadow of a painful past yet falls on this path forward, which was relevant two years ago and still does not belong to the category of scenarios impossible in the context of the current situation.
In a study from the Brookings Institution, which was published last week, it was noted that the reasons for the gloomy views of US consumers are that society is more partisan, media outlets have a bias towards bad news and the correlation between age and low sentiment may be driving down perceptions.
It is also worth noting that GDP data in the United States is currently particularly sensitive information. The relevant situation is related to the upcoming presidential elections in the US. It is the state of affairs in the economic space that is one of the main indicators of the quality of functioning of any country as a large-scale system. Society also evaluates the effectiveness of the government’s activities, focusing, among other things, on the economy’s condition.
The results of public opinion polls indicate that currently residents of the United States, who say that the economic situation is a top election issue, are chafed with high food and housing prices. The corresponding sentiments are observed, even though Washington managed to avoid the materialization of the recession scenario.
