Il mondo di Trump

United States

US GDP +2.8% annualised in Q3

Falling inflation and strong wage increases fuelled consumer spending also in the run-up to the presidential election

from our correspondent in New York Luca Veronese

30 October 2024

Un supermercato a Rosemead in California, la spesa per alimentari e i prezzi della casa sono tra le maggiori preoccupazioni degli elettori americani

2' min read

US GDP increased at an annualised rate of 2.8 per cent in the July-September period, maintaining a strong pace and in line with the April-June quarter in which the increase was 3 per cent.

Just days before the 5 November elections, data released by the Commerce Department's Bureau of Economic Analysis showed how falling inflation and strong wage increases supported consumer spending - up 3.7 per cent - even amidst a race for the White House full of tension and uncertainty.

The growth of the US economy was slightly lower than economists' expectations (who had estimated an expansion of 3%), but the United States has nevertheless warded off the recessionary risks that had been predicted at the beginning of the year. And they confirmed that they were better off than all the other major Western economies: the IMF forecasts US growth of 2.8% for the full year and 2.2% for next year.

US consumer confidence also increased and reached its highest level in nine months in October, according to a Conference Board report. While the labour market continues to hold surprisingly well. In the private sector in October - according to the monthly report compiled by Automatic Data Processing (Adp), the agency that prepares payrolls - 233 thousand net positions were added compared to the previous month: a figure well above expectations, marking the highest increase since July 2023.

Growth in the economy, falling inflation, confidence and a solid labour market: the data from the last days of the election campaign could give some support to Vice-President Kamala Harris, the candidate of the Democratic Party, against the Republican candidate, former President Donald Trump.

Polls continue to indicate a neck-and-neck race to the last vote between the two candidates, not only in the national consensus, but also in the analyses concerning the seven poised and decisive states, starting with Pennsylvania.

In recent months, US citizens have always put economic issues at the forefront of their concerns: the accumulated inflation of the past few years does not stop making itself felt in the pockets of households, despite the price index signalling annual increases of around 2%, thus close to the Federal Reserve's target. Spending on foodstuffs and housing costs are particularly heavy.

The US economy has been able to withstand the interest rate hike - 5.25 points between 2022 and 2023 - decided by the Federal Reserve to bring inflation under control after the pandemic crisis and subsequent price tensions. And as early as next week, the US central bank could loosen the squeeze further after cutting rates by half a percentage point last month, the first reduction since 2020, bringing the benchmark rate down to 4.75-5%.

Despite the economy's resilience during the years of Joe Biden's Democratic administration, polls show that voters have consistently given Trump their favour when it comes to growth and inflation. "It looks like economic growth is strong right before the election," said Christopher Rupkey, chief economist at FwdBonds. "There are some difficulties and opinions that cross the country, but," he added, "the economy is definitely in a better place than it was four years ago and shows no signs of slowing down.

Luca Veronesegiornalista
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Luogo: Milano
Lingue parlate: inglese, spagnolo
Argomenti: economia internazionale, politica internazionale
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