Data released this week showed that the U.S. economy continues to demonstrate resilience. According to estimates from the Commerce Department, U.S. third-quarter GDP grew at an annualized 4.9% pace. That’s the fastest rate of growth the economy has enjoyed in almost two years.
Behind the U.S. third-quarter GDP numbers
Many economists had forecast growth at around 4.3%. And even that rate was considered optimistic, after the 2.1% growth seen in the previous quarter. However, better than expected consumer spending, fueled by higher wages, helped to drive even greater growth. Experts say that consumer spending makes up more than two-thirds of all economic activity in the United States.
Notably, though, there were also major spikes in government spending and private business inventory expansion. Exports also rose in the last quarter. Moreover, consumer spending was driven by necessities like housing, food services, prescription drugs, and utilities. Plus, reports suggest that many Americans have been increasingly using their savings to keep pace with higher prices.
Biden takes a victory lap
Despite warning signs that the current growth may not last, President Joe Biden quickly tried to take credit for the positive news. In a statement, he noted:
“I never believed we would need a recession to bring inflation down – and today we saw again that the American economy continues to grow even as inflation has come down. It is a testament to the resilience of American consumers and American workers, supported by Bidenomics.”
Still, a plurality of Americans continues to question the effectiveness of the administration’s economic policies. That includes 49% of polled respondents who believe that the Republican Party are better on economic issues. That’s nearly double the 28% who claim that the Democrats offer better solutions.
Despite the administration’s rosy proclamations, worries about continuing high prices continue to dominate discussions around many American families’ kitchen tables. That fact alone may help to explain why a reported 59% of voters express disapproval of the President’s economic record. Unfortunately for the President, positive third-quarter GDP numbers may not be enough to change their minds.
