Saturday, November 29, 2014

U.S. Shows Impressive Growth in Third Quarter


US GDP

U.S. economy is showing robust rate which has turned out to be beyond the expectation of the market analysts in the third quarter. Its better performance is accredited to the strengthening of its fundamentals which would help it in weather the slowing global demand. The U.S. economy has posted back-to back growth in second and third quarter for the first time in last 11 years. This shows that economy is in good health along with a great momentum which would help it generating more returns.

GDP Grows and Boosts Confidence

The Commerce Department has raised its estimate of the possible GDP growth to 3.9% annually from just 3.5 % which it assumed last month. If we combine the 4.6% gain of the second quarter then it would be best six-month growth stretch for the U.S. economy after 2003. The poor performance of the economy has been resulting from the Japanese recession, a weak and depleted euro zone as well the slowing Chinese economy.

Increased Consumer Spending

The consumer spending has increased considerably from just 1.8% to 2.2%. GDP report points out that the Households are spending at the retail stores than at on the auto fuels. Another major source of the economy’s growth is the increase in the business investment in procuring equipments from just 7.2 % to 10.7%. The national companies have also boosted their inventories which helped in adding $79.1 billion to the GDP instead of $62.8 billion.

U.S. economy has also suffered from the downside in the few months. Its exports growth has diminished from 7.8% to 4.9% due to slower growth in Europe and Asia chopping out a bite from the economy. Even the imports suffered and fell at a 0.7% annual rate which was earlier estimated to be 1.7%.

More Returns In Upcoming Days

The U.S. economy is right on track for adding more new jobs since 1999. Sectors related from manufacturing to retail would continue to gain strength in upcoming days. The decrease in the gasoline prices has fuelled to a renewed optimism about economy which is heading in the new year. Decrease in fuel price is helping the citizens to save $50 dollars more each year due to falling energy costs. Even the inflation rose at just 1.3% annual rate in the third quarter than the 2.3% in the last quarter.

Growth Momentum Likely To be Carried Forward

The second and third quarters have shown a commendable growth in wages and salaries. Economists believe that the bringing GDP based wages and salaries measures into line with the earnings figures had helped in forming a right response and idea.

U.S. stocks have shown a little change while the dollar has performed poorly against the other major currencies. Prices for the U.S. Treasury debt rose just marginally. U.S. economy is growing stringer by each passing day and it is clearly apparent from the rising numbers in the GDP. The economists believe that the economy is having a great momentum and this momentum could even be transferred into the final three months of the year.

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