In its latest release of business figures, the US economy increased at a meagre rate of 1.9% in the third quarter. The US economy had slowed down but picked up due to investor confidence and an increase in domestic sales and steady consumer spending. The announcement was made by the US authorities on Wednesday.
The US economists had feared that the results would be even worse due to the ongoing trade dispute with China. But the fortunes swung because the business sector provided the push due to the increase in sales and profit margins.
It comes as a small relief for the Trump administration as his declared 3% growth was missed by a fair margin. The economists had predicted a growth rate of 2% in the July to September quarter but the economy actually grew a tad slower at 1.9%.
But there were some major concern areas as highlighted in the report due to the trade war with China which is probably going through its worst phase in the last few years and due to global economic slowdown. Business investments have also degraded the most in the last 4 years.
The investments done by the business houses slowed down and there was little investment done for new stores, factories, and hotels.
The main positive for the US economy proved to be consumer spending which remained solid mostly with the Christmas holidays to come. The consumer spending on durable goods like automobiles and computers was reduced to half though. One of the brightest sectors was the housing sector.
People had spent a lot in buying new homes due to mortgage rates being favourable in the past few months favourable although the housing sector had dragged the economy down for one and a half years. Exports also increased by a small margin adding to the growth.
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