GDP Accelerating to 2.9% Helping U.S. Overcome Sandy Woes [View all]
The U.S. economy looks set to weather the headwinds from Hurricane Sandy and the budget battles in Washington after picking up speed in the third quarter.
Gross domestic product probably increased at about a 2.9 percent annual rate in July-September, according to economists from Goldman Sachs Group Inc. and Barclays Plc. That would be the fastest quarterly growth this year, beating the Commerce Department’s initial estimate of 2 percent.
“The economy’s momentum has picked up a bit” as the fundamentals of the private sector “are improving,” said Jan Hatzius, chief economist at Goldman Sachs in New York. He projects third-quarter expansion will be revised up to 2.8 percent, and the fourth quarter may come in at 1.7 percent.
Help is coming from a housing recovery, strengthening job market and healthier household finances that are driving gains in consumer confidence and spending. While the damage from Sandy and an anticipated tightening of fiscal policy mean growth will decelerate this quarter and next, the world’s largest economy may emerge on stronger footing in the second half of 2013.