American GDP demonstrates stellar surge

American GDP demonstrates stellar surge

In the third quarter, the American economy posted a better-than-anticipated expansion, demonstrating its most impressive back-to-back quarter performance since 2014. However, market experts drew attention to the fact that risks for surge abound next year along with the data could make the Fed stick with a more aggressive monetary stance.

American GDP showed a 3.5% jump, surpassing estimates for 3.3%. It became possible due to firm consumer spending, which contributed 2.7% to the total economic surge figure.

However, the big question for financial markets, especially in light of the recent stock market moves, is whether it’s as good as it gets for US surge, as some financial analysts pointed out.

The experts added that there will be no short-term sink in surge because as they really hope that the fourth quarter is going to be backed by rebuilding as well as cleanup efforts from recent Hurricanes Michael and Florence.

Besides this, the experts told that they actually expect that surge to moderate in 2019.

From their point of view, tighter financial conditions, powered by higher interest rates as well as the stronger greenback might start biting. Meanwhile, persistent trade uncertainties, as well as fading fiscal tailwinds, might also start restraining activity in a more noticeable way, as the market experts pointed out.  

Notwithstanding the warning, these market experts made clear that the tight labor market with its upbeat influence on wage surge would probably remain in 2019. In addition to this, financial analysts foresee a good 2.4% surge reading for next year.

Taking this into account on can assume that the US key financial institution would proceed with its tightening cycle in the nearer future. To be exact, the major US bank is generally anticipated to have its rates lifted already in December and also up to three more times next year.

 

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