Considering the recent economic gloom from a recessionary yield curve to a hand-wringing Federal Reserve and predictors of catastrophe from China to the UK, it is remarkable that American consumers have kept their focus on jobs and household budgets rather than the market interpretations.
The US economy expanded at a 1.9% annualized pace in the third quarter, considerably better than the 1.6% forecast and slightly lower than the 2.0% expansion in the second quarter.
Personal consumption rose at a 2.9% yearly rate and accounted for all of the GDP increase while government expenditures expanded 2.0% and domestic private investment which included business spending, declined 1.5%.
On the quarter consumption rose 1.93% and the gain in government spending of 0.35% was offset by fixed investment -0.22%, inventories -0.05% and net trade -0.08%.
Retail sales in the GDP component control group moderated in the third quarter with the monthly increase falling to 0.4% from 0.57% in the second quarter but job creation climbed to 157,000 per month from 152,000 and annual wages increases stayed at the top of their decade range at 3.0%.
Reuters
Business spending and sentiment have been falling for more than a year as the two-year old trade war with China damaged exports and sapped optimism and inhibited expansion. The purchasing managers’ index in manufacturing slipped into contraction in August and September.
The recently announced trade agreement with China is expected to be signed sometime in November at which point it may begin to reverse some of the business apprehensions that have accumulated with the tariffs.
The steady US economic growth in spite of the global headwinds will no doubt cheer the Federal Reserve governors and may have implications for their rate decision to be delivered at 2:00 pm EDT today.
The Bureau of Labor Statistics will release the October payroll report on Friday November 1st at 12:30 GMT, 8:30 EDT.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
AUD/USD traders seem non-committed around 0.6500 amid mixed cues
AUD/USD extends its consolidative price move just above 0.6500 on Friday. The RBA's hawkish and upbeat market mood supports the Aussie, though mixed Australian PMI prints fail to inspire bulls. Moreover, bets for a slower Fed rate-cut path continue to fuel the post-US election USD rally and cap the currency pair.
USD/JPY slides to 154.00 as higher Japanese CPI fuels BoJ rate-hike bets
USD/JPY languishes near 154.00 following the release of a slightly higher-than-expected Japan CPI print, which keeps the door open for more rate hikes by the BoJ. That said, the risk-on mood, along with elevated US bond yields, could act as a headwind for the lower-yielding JPY and limit losses for the pair amid a bullish USD, bolstered by expectations for a less dovish Fed and concerns that Trump's policies could reignite inflation.
Gold price advances to near two-week top on geopolitical risks
Gold price touched nearly a two-week high during the Asian session as the worsening Russia-Ukraine conflict benefited traditional safe-haven assets. The weekly uptrend seems unaffected by bets for less aggressive Fed policy easing, sustained USD buying and the prevalent risk-on environment
Ethereum Price Forecast: ETH open interest surge to all-time high after recent price rally
Ethereum (ETH) is trading near $3,350, experiencing an 10% increase on Thursday. This price surge is attributed to strong bullish sentiment among derivatives traders, driving its open interest above $20 billion for the first time.
A new horizon: The economic outlook in a new leadership and policy era
The economic aftershocks of the COVID pandemic, which have dominated the economic landscape over the past few years, are steadily dissipating. These pandemic-induced economic effects are set to be largely supplanted by economic policy changes that are on the horizon in the United States.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.