Call it the calm before the storm.
After shrinking the first half of the year, the U.S. economy rebounded from July through September despite inflation that has hovered near a 40-year high and sharply rising interest rates. But the performance likely marked reprieve ahead of next year’s projected recession rather than a sign of brighter outlook.
The solid showing was fueled by a more favorable trade balance and modest rises in consumer and business spending, offsetting another plunge in housing construction and weaker business stockpiling.
“The U.S. economy is undeniably cooling,” Gregory Daco, chief economist of EY-Parthenon, wrote in a note to clients.
The nation’s gross domestic product, the value of all goods and services produced in the U.S., grew at a seasonally adjusted annual rate of 2.6% in the third quarter, the Commerce Department said Thursday. Bloomberg had forecast a 2.3% rise in output.
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