U.S. economic growth slowed less than expected in the third quarter with resilient consumer spending offsetting declining business investment, allaying fears of a recession
WASHINGTON - U.S. economic growth slowed less than expected in the third quarter as a further contraction in business investment was offset by resilient consumer spending, further allaying financial market fears of a recession.
“An orderly economic slowdown is in progress,” said Sung Won Sohn, a business economics professor at Loyola Marymount University in Los Angeles. “If the business caution continues, there will be fewer jobs and slower income growth eventually adversely impacting consumer spending and economic growth.”
The U.S. central bank is expected to cut interest rates for the third time this year on Wednesday. The Fed cut rates in September after reducing borrowing costs in July for the first time since 2008. “The economy is still laboring against the headwinds of trade war uncertainty,” said Chris Rupkey, chief economist at MUFG in New York. “Even if growth miraculously soars 4.0% in the fourth quarter the economy won’t grow faster than 2.8% in 2019.”
A separate report on Wednesday showed private payrolls increased by 125,000 jobs in October after rising 93,000 in September. Job gains have been slowing this year because of slowing demand and worker shortages.
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