Economy Grows 2.8%

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U.S. Economy Grows Despite Interest Rate Hikes

The U.S. economy grew at a solid 2.8% annual rate in the third quarter, surprising economists who had predicted a slightly lower 2.6%. This growth was driven by consumer spending, which remained strong despite higher interest rates.

The economy has shown resilience in the face of the Federal Reserve’s efforts to curb inflation by raising borrowing costs. Hiring and consumer spending have remained steady, defying expectations of a recession.

Consumer Confidence and Spending Up

Consumer confidence rose in October, reaching its highest level since early 2022. This suggests that households are optimistic about the economy and will continue spending, which is essential for growth.

Strong Domestic Demand

Domestic demand, including consumer spending and business investment, was strong in the quarter. Consumer spending grew over 3.5%, indicating that consumers are not yet slowing down their purchases.

Despite hurricanes and port strikes that could impact the upcoming jobs report, the U.S. economy is generally performing well. This positive outlook is supported by a strong labor market and resilient consumer spending.


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