Comment on Q3 GDP: Kathy Bostjancic, Director for Macroeconomic Analysis, The Conference Board
Q3 GDP: AN UNSUSTAINABLE SPURT
NEW YORK, Oct. 27, 2011 /PRNewswire/ -- The U.S. Bureau of Economic Analysis today reported 2.5 percent growth in real gross domestic product for the third quarter of 2011.
The better than expected performance this summer doesn't look sustainable. Continued woes in the housing market are overshadowed by consumer concern over the anemic labor market, as highlighted by the decline in consumer sentiment back to 2008-09 levels. Weak sentiment could limit the rise in consumption through the holiday season and right into winter. Further, cuts in spending by state and local municipalities weigh on the economy. Business investment, inventory, and exporting hold the key to how much growth can be anticipated through the first half of 2012. Sustained economic growth above 2.0 percent is simply unlikely.
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