Economic growth in the U.S. was worse than expected last quarter, according to one of the final major economic releases before next week’s election.
President Joe Biden appears at the Economic Club of Washington last month.
The country’s real gross domestic product, an inflation-adjusted measure of all American goods and services produced in the country, grew at a 2.8% annual rate during the third quarter, according to preliminary data released Wednesday morning by the Bureau of Economic Analysis.
That is worse than the second quarter’s 3% expansion and median economic forecasts of 3.1% third-quarter growth, according to Dow Jones data.
$29.4 trillion. That’s how large the U.S. economy is, according to current-dollar GDP, which is adjusted for changes in the dollar’s value. The U.S. is by far the largest economy in the world by GDP, with China, the world’s next biggest economy, at about $18 trillion in adjusted GDP.
This was one of the last major economic releases ahead of next Tuesday’s election, with September’s PCE inflation reading slated for Thursday morning and October’s monthly employment update due Friday. Several polls find voters' top issue for the presidential choice is the economy, and many Americans hold negative views of the state of the economy despite the robust headline growth, at least partially a reflection of the lingering effects of the post-pandemic inflation surge which crested in 2022.
After a weak start to 2022 which included the U.S.’ first quarter-over-quarter GDP contraction outside of the first half of 2020 since 2014, the U.S. has returned to solid footing. That has seemingly wiped away the concerns expressed by many experts that an extended downturn may be a necessary side effect of rightsizing inflation. Goldman Sachs economists put the odds of a U.S. recession over the next 12 months at just 15%, the neutral rate for its model accounting for unforeseen headwinds.