Great economic news: US economy grows 2.9 %
After a sluggish 1 percent growth for each of the first two quarters of 2016, drawing criticism from opponents of the Obama administration that the national economy was not growing, on Friday the US Commerce Department announced the economy grew by 2.9 percent in the third quarter of the year.
The economic growth coincides with the increase in the nation’s Gross Domestic Product (GDP), the value of all the goods and services produced in the national economy. The surge in economic growth reflects growth in investment, exports and consumer spending.
Recently, economists surveyed by Bloomberg predicted that the economy would grow by 2.6 percent in the third quarter.
Miami economist Lindsay Bramwell had predicted an increase between 2.3 and 2.5 percent. “I definitely predicted positive growth, with oil price levelling off below $50 per barrel. The low price has strengthened the ability of countries that buy US products to purchase more, which is a tremendous boost to the US export market. This increase has in turn boost the sales of businesses, small, medium and large.”
Bramwell also cited that with employment on the rise across the country, and the price of one of the more demanding commodities, gasoline, falling consumers are spending more, and able to reduce household debt.
The growth of the nation’s economy has also been attributed to the maintenance of a low interest rate by the Federal Reserve. The Federal Reserve has been looking for an acceleration in economic growth before raising interest rates again. The Fed is scheduled to meet next week but most economist do not expect the national interest rate to increase, even with the positive GDP growth. It is believed the Fed Reserve will not raise rates until concern over the November 8 presidential election subsides, and the new president and administration is settled. The Fed has also signaled that before raising the interest rate it wants to see a lowering of the unemployment rate below the current 5 percent that has prevailed since August this year.
