The US economy has posted the strongest recovery ever on record, with an annual rate showing 33.1 percent annual rate expansion in Gross Domestic Product (GDP) for the third quarter, the Department of Commerce reported Thursday. (The annual rate shows the 12-month result if one calculates the gain from a single quarter to be translated over a 12-month period.) The news follows a 31.4 percent annual rate drop in the second quarter, the first wave of the COVID-19 pandemic, and a five percent drop in the first quarter.
“The increase in third quarter GDP reflected continued efforts to reopen businesses and resume activities that were postponed or restricted due to COVID-19,” the Commerce Department said.
“The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the third quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified,” the report continued.
Current dollar GDP increased 38.0 percent, or $1.64 trillion, in the third quarter to a level of $21.16 trillion. In the second quarter, GDP decreased 32.8 percent, or $2.04 trillion.
The price index for gross domestic purchases increased 3.4 percent in the third quarter in contrast to a decrease of 1.4 percent in the second quarter (table 4). The PCE price index increased 3.7 percent in contrast to a decrease of 1.6 percent. Excluding food and energy prices, the PCE price index increased 3.5 percent, in contrast to a decrease of 0.8 percent.
Americans saved more than $22 trillion between March and September. And once we beat the virus, there will be pent-up demand in the tourism sector,” Commerce Secretary Wilbur Ross said in remarks Thursday at a Roundtable with the Greater Fort Myers Chamber of Commerce.
“Recent trends are promising, with US consumers spending nearly $2 trillion more in August than they did in April. In fact, Americans are spending more in our economy now than they did when President Trump first arrived in office,” Ross added.