US economy grows at 2.1% in 2nd Quarter.
The US economy grew at a 2.1% annual rate from April 2023 till June 2023, continuing its steady performance in the backdrop of relatively higher interest rates. The government has kept its previous estimate unchanged.
Gross Domestic Product | U.S. Bureau of Economic Analysis (BEA)
The 2nd quarter increase of the USA’s GDP ie its total output of goods and services recorded a minimal reduction from the revised 2.2 percent annual growth recorded from January 2023 till March 2023.
The overall economy has shown surprising recovery, though the interest rates have been raised 11 times to defend against the inflation, which had tested the mark of a four-decade high. The higher rates trigger a concern of a recession.
Till now, the inflation has been kept within control without causing any further detriment to the economy and the Fed seems to have been successful in balancing the control over inflation while mitigating the risk of recession.
Growth expected in 3rd and 4th quarter.
The growth is expected to be catching up in the current quarter, thanks to the free-spending consumers. Many Americans seem to be spending like before and enjoying lives going to theatres for movies etc. the corporate investments are also showing signs of robust recovery.
Economists have estimated that the US economy will grow at a roughly 3.2% annual rate in the 3rd quarter, which would be the fastest quarterly growth in a year, however at the same time, the economy is expected to slow down in the final 3 months of the year impacting the savings of all Americans.
The surging oil prices, the student loan payments, Auto Workers strike, the loss of Covid-era childcare aid, are few of the major factors impacting the economy. These together may hamper Americans’ spending ability and likely hamper the US economy.
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