US economic growth in third quarter shatters previous records

After precautionary lockdowns to slow the spread of COVID-19 decimated the economy, many predicted that the US was in for a catastrophic economic fallout.

However, according to U.S. Commerce Department data, the growth of the US economy shattered records in the third quarter, expanding at an annualized pace of 33.1 percent.

Rebound from COVID-19

This finding suggests that the US is recovering significant ground from the months-long losses, and though the US economy has still shrunk from highs in January and February, the outlook is significantly more optimistic than many believed.

Breitbart reported that the expansion has come in virtually all aspects of the US economy, from housing to business investments to consumer spending.

“The third-quarter GDP gain was fueled by a record 40.7 percent increase in consumer spending,” Breitbart noted. “Business investment surged 20.3  percent during the quarter, reflecting a 70.1 percent jump in investment in equipment. The housing market is booming: residential investment grew at a rate of 59.3 percent.”

The former post-World War II record was a 16.7% increase in 1950, pointing to a major rebound. However, the economy contracted at an annual revised rate of 31.4% in the previous quarter — the same months the bulk of the nation’s lockdowns lay — and the US is still “in a deep hole from the COVID-induced recession,” Fox Business reported.

Steve Rick, chief economist at CUNA Mutual Group cautioned that growth measured in the third quarter is measured against the second, so bounceback may be exaggerated.

“Even though this quarter’s GDP came in relatively strong, we have to keep in mind that this grade comes on a big curve – this is really a benchmark against the drastic hole we started to climb out of in [the second quarter],” Rick said.

Good news for Trump

Though this latest economic data is only a piece of the puzzle, it still points to recovery rather than further economic retraction, injecting optimism into the air just days before the election.

Donald Trump is expected to highlight data showing massive economic improvements in the final days leading up to the election. The “Trump economy” was one of the incumbent’s biggest selling points before COVID-19, and Trump is eager to return to campaigning on the economy.

Trump campaign communications director Tim Murtaugh issued a statement celebrating the news, writing that it’s an “absolute validation of President Trump’s policies, which create jobs and opportunities for Americans in every corner of the country.”

“The President built the world’s best economy once and he’s rapidly doing it again, proving that cutting taxes and reducing regulations and red tape clear the way for American ingenuity and our entrepreneurial spirit to thrive,” Murtaugh declared.

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