The U.S. economy grew 2% in the third quarter of this year, according to Commerce Department figures in Washington. According to Bloomberg, the median forecast of 76 economists called for 1.9 percent increase compared with the previously reported 2.1 percent pace.
Gross domestic products grew 2% compared with the 3.1% increase of the second quarter. The trigger points of the slight downgrade are a large trade deficit and inventory buildup.
The good thing is the growth of consuming. With the help of strong job creation, Consumers are spending money at a faster pace. That’s what mainly leads to growth because consumers account for more than two-thirds of economic activity. However, the bad thing is about downgrade of investment. Businesses have scaled back investment in order to deal with sluggish exports, cheap oil and lower profits.
Last quarter, consumer spending grew at a solid 3 percent pace, unchanged from the previous estimate. Business investment on structures fell at a 7.2 percent annual rate, slightly worse than previously, as cutbacks in oil and gas exploration hurt the energy sector. Business investment in equipment shot up at a 9.9 percent annual rate.
Entering the New Year, economists are forecasting that consistent strength in the job market will boost household incomes and support solid consumer spending.