The US Bureau of Economic Analysis reported that real gross domestic products (GDP) rose by 2.8% in the third quarter of 2024. This is a slight decline from the 3.0% growth in the previous quarter, and is below market expectations.
This GDP growth is largely due to an increase in consumer spending, exports and federal government expenditures.
The rise in imports also has an impact on the GDP calculation.
Consumer spending has increased on products and services. This is particularly true for nondurables like prescription drugs, cars, healthcare services and food.
Exports, especially capital goods, also increased, while federal expenditures in defense-related areas increased significantly.
Comparative analysis with the previous quarter
The slowdown of GDP growth in Q3 can be attributed a decline in residential fixed investment and private inventory investment.
Despite the rise in imports, gains in exports and consumer spending as well as government expenditures offset this.
The GDP in current dollars rose by 4.7% to $29.35 trillion during Q3.
The price index for personal consumption expenditures (PCEs) increased by 1.5%, while the price index for gross domestic purchase (GDP) rose by 1.8%.
The PCE index grew by 2.2% when energy and food costs are excluded.
Personal Income Trends
Personal income increased by $221.3 Billion in the third quarter due to a significant compensation growth.
The disposable personal income increased by 166.0 billion dollars, or 3.1%. This represents a real increase of 1.6%.
This paper highlights the US’s uneven performance in the third quarter, demonstrating resilience against numerous sector headwinds.
The “second” estimate of this quarter will be released on November 27th, 2024. It is expected to shed further light on the economy.
Analysis of personal savings in the recent GDP estimate
Personal savings decreased from $1.13 trillion in the third quarter to $1.04 billion compared to the quarter before.
The personal saving rate, a measure of personal savings as a percent of disposable income, also fell during the same time period, from 5.2% to 4,8%.
This shift in saving behaviour highlights changes in consumer behavior and the overall economic conditions at that time.
The estimate of GDP that was released is based on preliminary data. These may be revised by the agency providing information later.
You can find more information on the key assumptions and source data that went into the initial estimate in the Technical Note and “Key Source Data” document.
On November 27, 2024, a more detailed “second” estimate of the third quarter will be published, which will include better data. Watch out for future updates and analyses.
This post US GDP growth moderates to 2.8% in Q3, slightly lower than market expectations may be updated as new information unfolds
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