Le Monde | • Updated | By
US growth in the third quarter had its best performance since 2003. The third (and final) estimate of the Department Trade, published Tuesday, December 23, reported a growth in gross domestic product (GDP) of 5% annualized (1.25% real growth compared to the previous quarter). A figure higher than the 3.9% previously announced.
Consumer spending, which accounts for 70% of the activity in the United States, was the main driver of growth. Purchases increased 3.2%, one point more than what had been anticipated in the second estimate of Commerce.
Spending was particularly robust in health, recreation, and financial services. But purchases of durable and non-durable were also revised upwards. Overall, the 5% growth recorded between July and September, household consumption contributed 2.2 percentage points.
Business investment was not far behind with an increase 4.8%. Spending in the construction sector, software and research and development were particularly dynamic
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Compaction expected by year-end
The trade balance also contributed to the performance of the US economy. The reduction of the foreign trade deficit made 0.8 growth point.
In addition, the 4.4% increase in public spending, particularly active in the defense sector, added 0, 7 points of growth.
Finally, corporate profits are on the upside. They were up 2.8% in the second quarter, 1.1 points higher than what was expected before.
The US economy is on a solid momentum for two quarters. After a slump in January-March (-2.9%), mainly due to awful weather, the world’s largest economy had increased by 4.6% between April and June.
Most economists, however, expect a slight reduction plan in the fourth quarter. The Federal Reserve (Fed) expects a growth of 2.3 or 2.4% between October and December
Sign of the likely slowdown. Orders for durable goods fell 0.7% unexpectedly in November, according to statistics from the Commerce Department also reported Tuesday.
Companies ordered fewer computers, electrical equipment and metal. Furthermore, the contribution of foreign trade to US GDP is expected to wane due to the slowdown in global growth.
An “oil effect” to come
In contrast, consumption should be supported by lower oil prices, which, hitherto, played at the margin on the purchasing power of households, but that will start to full effect in the fourth quarter and especially in 2015.
The price of a gallon of gasoline has dropped to 2.38 dollars (50 cents per liter), a level that had not been seen since May 2009.
“The decline in oil prices, if it continues as we expect, will help support economic growth in 2015″ , says Beth Ann Bovino, the chief economist Standard and Poor’s (S & amp; P).
According to the credit rating agency, any decrease of 10 dollars in oil prices causes an increase in consumer purchasing power by 0.4% .
On the other hand, S & amp; P believes that the fall in crude prices will have negative consequences for investment and employment in the energy sector, although overall effect should be positive for all of the US economy, which is expected to grow 3.1% in 2015.
The use expected to remain a growth factor support. In November, the US economy created 321,000 jobs. The monthly pace of hiring in 2014 was 240,910, almost 47,000 more than in 2013.
This overall favorable environment should encourage the Fed to raise interest rates, probably at the end the first half, said most economists
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