U.S. economic growth slowed less than expected in the third quarter as declining...
WASHINGTON - U.S. economic growth slowed less than expected in the third quarter as declining business investment was offset by resilient consumer spending and a rebound in exports, which could further allay financial market fears of a recession.
The Trump administration’s trade war with China has eroded business confidence, contributing to the second straight quarterly contraction in business investment. The fading stimulus from last year’s $1.5 trillion tax cut package is also casting a shadow on the expansion, now in its 11th year. The economy grew at a 2.0% pace in the April-June period. Economists estimate the speed at which the economy can grow over a long period without igniting inflation at between 1.7% and 2.0%. Economists polled by Reuters had forecast GDP increasing at a 1.6% rate in the July-September quarter.
Consumer spending is being powered by the lowest unemployment rate in nearly 50 years. But some economists are starting to question the resilience of the consumer after retail sales fell in September for the first time in seven months. Consumer confidence has also been trending lower and wage growth is stalling.
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