US economy not growing quite as strongly as expected
The US economy did not grow quite as strongly as expected in the summer. Gross domestic product (GDP) rose by an annualized 4.9% from July to September, following growth of 2.1% in the second quarter, according to final data released by the US Department of Commerce on Thursday.
An earlier estimate for the third quarter was for growth of 5.2 percent. According to the Federal Reserve (Fed), the economy has recently shown signs of slowing down considerably. The outlook for the next six to twelve months has also deteriorated. The tight monetary policy is tending to dampen economic activity.
In their projections for the end of the year, the US monetary authorities expect GDP to grow by 2.6%. Growth is then expected to slow to 1.4 percent in 2024. Fed Chairman Jerome Powell still believes a so-called "soft landing" of the economy is possible. This is a scenario in which the Fed succeeds in curbing inflation without triggering a recession and causing turmoil on the labor market. US Treasury Secretary Janet Yellen also expects a soft landing. Powell's predecessor at the helm of the Fed does not consider the risk of a recession to be particularly high.
The Fed's aim is to get inflation under control again with high interest rates.
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Despite the Fed's efforts to control inflation with high interest rates, the US economy's growth rate in the summer was lower than anticipated. This summer slip in growth could potentially impact economic activities in the upcoming seasons.
The recent slowdown of the US economy is not limited to the summer as the Fed has expressed concerns about the economy's prospects for the next six to twelve months.
Source: www.ntv.de
