The Chicken Littles of the American economy have egg on their faces following the Commerce Department’s report Tuesday showing annual growth of 4.3% in the third quarter from July through September, decisively beating analysts’ expectations of 3% growth and improving on the second quarter’s 3.8%, the Associated Press reported.
It’s the most rapid expansion of the economy in two years, driven by consumer and government spending and exports, suggesting that President Trump’s much-ballyhooed economic policies, especially tariffs, are not hampering the economy on the whole.
Exports shot up 8.8% while imports fell 4.7%, and consumer spending rose 3.5%, up from 2.5% in the second quarter. Inflation also rose, however, up 2.8% from 2.1% in the personal consumption expenditures index favored by the Federal Reserve, but the increase was less drastic when excluding “volatile food and energy prices,” according to the AP.
Government consumption and investment grew 2.2% after declining 0.1% in the second quarter, led by state and local increased expenditures and federal defense spending.
The decline in private business investment slowed to a trickle, down just 0.3% compared to the 13.8% plunge in the second quarter.
The report’s release was delayed by the government shutdown.
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