The American economy expanded at a healthy 2.8% annual pace from July through September, driven by strong consumer spending and a surge in exports, according to the latest report from the Commerce Department. This growth rate remained unchanged from the initial estimate for the third quarter.
While the GDP growth rate slowed slightly from the previous quarter, the report indicates that the U.S. economy continues to demonstrate resilience, with growth exceeding 2% for eight of the last nine quarters.
Consumer spending, a key driver of economic activity, accelerated to a 3.5% annual pace in the third quarter, marking the fastest growth since the first quarter of 2023. Additionally, exports saw a significant increase, growing at a rate of 7.5%, the highest in two years.
However, the report also highlighted a slowdown in business investment, particularly in housing and nonresidential buildings. On the other hand, spending on equipment experienced a surge during the same period.
As President-elect Trump prepares to take office, he will inherit an economy that appears to be in good shape. With steady growth, low unemployment at 4.1%, and a decrease in inflation from its peak earlier in 2022, the economic landscape is relatively stable.
Despite the positive indicators, inflation remains a concern for many Americans, with prices currently about 20% higher than they were in February 2021. The Federal Reserve, responding to inflationary pressures, has cut its benchmark interest rate in September and is expected to do so again in December.
Looking ahead, President-elect Trump has pledged to implement new economic policies, including imposing import taxes on goods from China, Mexico, and Canada. While these measures may have inflationary effects, their impact on the economy remains to be seen.
The latest GDP report is the second of three assessments for the third quarter, with the final report scheduled for release on December 19th.
