Economists may be expecting the U.S. economy to slow in the fourth quarter, but don't look at the final, revised third-quarter GDP statistic for evidence of that.
In its final evaluation of U.S. Q3 macroeconomic performance, the U.S. Commerce Department announced Thursday that the nation's economy grew at a 4.9% annualized rate, the fastest growth in four quarters, and unchanged from the previous Q3 estimate. In Q2, the economy grew at 3.8% annualized rate.
Economist Steve Affinito told BloggingStocks Thursday that although GDP held up reasonably well in Q3, he expects a decidedly lower statistic for Q4.
"In Q4, we should begin to see the weight of subprime mortgage defaults and reduced consumer confidence," Affinito said. "That will definitely produce a lower GDP stat, so no one should be deceived by the Q3 stat. The U.S economy is slowing. The question now is, by how much and how long will it take to rev-it-up again."
Affinito said he expects fourth quarter GDP growth to be 1.9-2.5%, adding that any fourth quarter GDP growth below 1.9% "would be troublesome -- a data point signaling a possible recession in 2008."
In its final evaluation of U.S. Q3 macroeconomic performance, the U.S. Commerce Department announced Thursday that the nation's economy grew at a 4.9% annualized rate, the fastest growth in four quarters, and unchanged from the previous Q3 estimate. In Q2, the economy grew at 3.8% annualized rate.
Economist Steve Affinito told BloggingStocks Thursday that although GDP held up reasonably well in Q3, he expects a decidedly lower statistic for Q4.
"In Q4, we should begin to see the weight of subprime mortgage defaults and reduced consumer confidence," Affinito said. "That will definitely produce a lower GDP stat, so no one should be deceived by the Q3 stat. The U.S economy is slowing. The question now is, by how much and how long will it take to rev-it-up again."
Affinito said he expects fourth quarter GDP growth to be 1.9-2.5%, adding that any fourth quarter GDP growth below 1.9% "would be troublesome -- a data point signaling a possible recession in 2008."
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