In a significant economic update, the US economy’s growth rate for the second quarter of 2024 has been revised upward to 3 per cent, according to data released on August 29. This revision marks a notable improvement from earlier estimates and underscores the critical role that consumer spending continues to play in sustaining the nation’s economic momentum, as detailed in a report by Reuters.&nbsp;

How has the consumer spending and unemployment rate performed?&nbsp;

Consumer spending, which accounts for more than two-thirds of the US economy, surged at a revised rate of 2.9 per cent during the second quarter. This increase reflects the enduring confidence of American consumers, who have maintained robust spending levels despite ongoing concerns about inflation and rising interest rates.&nbsp;

The stability of the US job market, characterised by low unemployment rates, has been a significant factor in bolstering consumer confidence. This security has encouraged households to continue spending, thereby driving economic growth during a period of global uncertainty.&nbsp;

Role of business investments&nbsp;

Business investment also played a crucial role in the revised growth figures. Companies across various sectors have increased their investments in infrastructure, technology, and other long-term assets, contributing to the overall economic expansion. These investments are expected to have lasting positive effects on productivity and growth.&nbsp;

The moderation of inflation, while still a concern, has also supported consumer spending by preserving purchasing power. Recent data suggests that price increases are beginning to slow, allowing consumers to maintain their spending habits without feeling the full brunt of inflationary pressures.&nbsp;

The revised growth rate has significant implications for US economic policy. The Federal Reserve may need to reconsider its approach to interest rate adjustments, taking into account the stronger-than-expected economic data. A cautious stance on rate hikes could be necessary to avoid hindering the current economic momentum.&nbsp;

Additionally, the government may prioritise further infrastructure investments, seeing them as essential to long-term economic efficiency. Support for small businesses could also become a focus, as these enterprises are key to maintaining a diverse and innovative economy.

Despite the encouraging economic indicators, there are still concerns about consumer sentiment. Some recent surveys indicate a dip in consumer optimism, driven by fears of inflation and potential economic downturns. This could impact future spending patterns, making it critical for policymakers to address these concerns through clear communication and strategic adjustments.&nbsp;

As the US economy navigates the complexities of inflation and global uncertainties, the revised growth rate for Q2 2024 serves as a reminder of the resilience and adaptability of the American economy. However, sustaining this momentum will require a balanced approach that considers both growth and consumer confidence in the months ahead.

In a significant economic update, the US economy’s growth rate for the second quarter of 2024 has been revised upward to 3 per cent, according to data released on August 29.

In a significant economic update, the US economy’s growth rate for the second quarter of 2024 has been revised upward to 3 per cent, according to data released on August 29. This revision marks a notable improvement from earlier estimates and underscores the critical role that consumer spending continues to play in sustaining the nation’s economic momentum, as detailed in a report by Reuters. How has the consumer spending and unemployment rate performed? Consumer spending, which accounts for more than two-thirds of the US economy, surged at a revised rate of 2.9 per cent during the second quarter. This increase reflects the enduring confidence of American consumers, who have maintained robust spending levels despite ongoing concerns about inflation and rising interest rates. The stability of the US job market, characterised by low unemployment rates, has been a significant factor in bolstering consumer confidence. This security has encouraged households to continue spending, thereby driving economic growth during a period of global uncertainty. Role of business investments Business investment also played a crucial role in the revised growth figures. Companies across various sectors have increased their investments in infrastructure, technology, and other long-term assets, contributing to the overall economic expansion. These investments are expected to have lasting positive effects on productivity and growth. The moderation of inflation, while still a concern, has also supported consumer spending by preserving purchasing power. Recent data suggests that price increases are beginning to slow, allowing consumers to maintain their spending habits without feeling the full brunt of inflationary pressures. The revised growth rate has significant implications for US economic policy. The Federal Reserve may need to reconsider its approach to interest rate adjustments, taking into account the stronger-than-expected economic data. A cautious stance on rate hikes could be necessary to avoid hindering the current economic momentum. Additionally, the government may prioritise further infrastructure investments, seeing them as essential to long-term economic efficiency. Support for small businesses could also become a focus, as these enterprises are key to maintaining a diverse and innovative economy. Despite the encouraging economic indicators, there are still concerns about consumer sentiment. Some recent surveys indicate a dip in consumer optimism, driven by fears of inflation and potential economic downturns. This could impact future spending patterns, making it critical for policymakers to address these concerns through clear communication and strategic adjustments. As the US economy navigates the complexities of inflation and global uncertainties, the revised growth rate for Q2 2024 serves as a reminder of the resilience and adaptability of the American economy. However, sustaining this momentum will require a balanced approach that considers both growth and consumer confidence in the months ahead.

US economy sees 3% growth in the second quarter, boosted by consumer spending

US consumer spending in December took its biggest dive in nearly a decade, retreating during a month when Wall Street suffered a historic rout, according to government data released Friday.

In January, consumers also saw the biggest decline in disposable income in six years, suggesting they might not have rushed to resume spending at the start of 2019, the Commerce Department reported.

Meanwhile inflation &nbsp;at the end of the year continued to hover just below the Federal Reserve's two percent target, weighed down by falling energy prices, according to the report.

However, the Fed is working with limited data ahead of this month's interest rate-setting policy meeting, due to the recent government shutdown that spanned five weeks. The Commerce Department was forced to delay many reports, and the release Friday did not have complete data for January, depriving the Fed of a key inflation measure.

As US stocks suffering their worst December since the Great Depression, Americans put the brakes on shopping, causing the biggest drop in consumer spending since September 2009, according to the report.

This came despite a large bump in disposable income, which grew 1.1 per cent that month, its biggest increase in six years, driving up the savings rate to its highest level in nearly three years.

The numbers were another sign that the US economy slowed sharply at the end of 2018. Economists say Wall Street sell-offs can make consumers more cautious about spending.

However, economists say the numbers are misleading and will be revised upwards as more data comes in.

"We remain firmly of the view that the December retail sales and spending numbers will be revised up sharply in due course, but for now the data are grim," said Ian Shepherdson of Pantheon Macroeconomics.&nbsp;

The January dip in income was merely a return to normal after December's increase, he said.&nbsp;

In January, incomes fell and disposable income declined 0.2 per cent, the biggest drop since January 2013, suggesting consumers faced a disincentive to resume spending again at the start of 2019.

Meanwhile, falling energy prices continued to weigh on inflation.

The Personal Consumption Expenditures price index -- the Fed's preferred inflation measure -- rose 0.1 per cent in December compared to November. Excluding volatile food and fuel prices, the "core" index gained 0.2 per cent for December, a tenth higher than economists' expectations.

Year-on-year, the index slowed to 1.7 per cent, its slowest pace since October of 2017, but the core index held steady at 1.9 per cent. 
&nbsp;

US consumer spending in December took its biggest dive in nearly a decade, retreating during a month when Wall Street suffered a historic rout, according to government data released Friday.

US consumer spending in December took its biggest dive in nearly a decade, retreating during a month when Wall Street suffered a historic rout, according to government data released Friday. In January, consumers also saw the biggest decline in disposable income in six years, suggesting they might not have rushed to resume spending at the start of 2019, the Commerce Department reported. Meanwhile inflation at the end of the year continued to hover just below the Federal Reserve's two percent target, weighed down by falling energy prices, according to the report. However, the Fed is working with limited data ahead of this month's interest rate-setting policy meeting, due to the recent government shutdown that spanned five weeks. The Commerce Department was forced to delay many reports, and the release Friday did not have complete data for January, depriving the Fed of a key inflation measure. As US stocks suffering their worst December since the Great Depression, Americans put the brakes on shopping, causing the biggest drop in consumer spending since September 2009, according to the report. This came despite a large bump in disposable income, which grew 1.1 per cent that month, its biggest increase in six years, driving up the savings rate to its highest level in nearly three years. The numbers were another sign that the US economy slowed sharply at the end of 2018. Economists say Wall Street sell-offs can make consumers more cautious about spending. However, economists say the numbers are misleading and will be revised upwards as more data comes in. "We remain firmly of the view that the December retail sales and spending numbers will be revised up sharply in due course, but for now the data are grim," said Ian Shepherdson of Pantheon Macroeconomics. The January dip in income was merely a return to normal after December's increase, he said. In January, incomes fell and disposable income declined 0.2 per cent, the biggest drop since January 2013, suggesting consumers faced a disincentive to resume spending again at the start of 2019. Meanwhile, falling energy prices continued to weigh on inflation. The Personal Consumption Expenditures price index -- the Fed's preferred inflation measure -- rose 0.1 per cent in December compared to November. Excluding volatile food and fuel prices, the "core" index gained 0.2 per cent for December, a tenth higher than economists' expectations. Year-on-year, the index slowed to 1.7 per cent, its slowest pace since October of 2017, but the core index held steady at 1.9 per cent.

US consumer spending in December at historic low, reveals government data

The American shopping orgy known as Black Friday lured more buyers this year but they spent less per person thanks to great bargains, an industry group said on Sunday.

More than 154 million people made purchases during the four-day retail extravaganza that began Thursday on Thanksgiving, compared to 151 million last year, the National Retail Federation said.

Shoppers spent an average of $289.19, compared to $299.60 in 2015.

Sales over the Thanksgiving holiday, which extends into so-called Cyber Monday, are a good indicator of the health of US consumer spending.

Online sales dominated. A total of 44 per cent of those who took part in the NRF survey said they had bought via the internet while 40 per cent went to a brick-and-mortar store.

&quot;It was a strong weekend for retailers, but an even better weekend for consumers, who took advantage of some really incredible deals,&quot; NRF president Matthew Shay said.

The most popular day to shop online was Black Friday itself, the day after the Thanksgiving holiday. Of those who purchased online over the four-day period, 74 per cent did so on Friday, up 1.3 per cent from last year.

And of the people who went to actual stores over this shopping period, 75 per cent did so on Black Friday, up 3.4 per cent from last year, the NRF said.

Millennials, aged 18-34, drove the increase in shopping, with eight out of ten buying something over the long weekend.

Around 56 per cent of smartphone owners and 53 per cent of tablet owners used these devices to assist with their shopping.

The study was carried out by Prosper Insights &amp; Analytics with a sample of 4,330 people on November 25-26 and has a margin of error of 1.5 percentage points.

(AFP)

Shoppers spent an average of $289.19, compared to $299.60 in 2015

The American shopping orgy known as Black Friday lured more buyers this year but they spent less per person thanks to great bargains, an industry group said on Sunday. More than 154 million people made purchases during the four-day retail extravaganza that began Thursday on Thanksgiving, compared to 151 million last year, the National Retail Federation said. Shoppers spent an average of $289.19, compared to $299.60 in 2015. Sales over the Thanksgiving holiday, which extends into so-called Cyber Monday, are a good indicator of the health of US consumer spending. Online sales dominated. A total of 44 per cent of those who took part in the NRF survey said they had bought via the internet while 40 per cent went to a brick-and-mortar store. "It was a strong weekend for retailers, but an even better weekend for consumers, who took advantage of some really incredible deals," NRF president Matthew Shay said. The most popular day to shop online was Black Friday itself, the day after the Thanksgiving holiday. Of those who purchased online over the four-day period, 74 per cent did so on Friday, up 1.3 per cent from last year. And of the people who went to actual stores over this shopping period, 75 per cent did so on Black Friday, up 3.4 per cent from last year, the NRF said. Millennials, aged 18-34, drove the increase in shopping, with eight out of ten buying something over the long weekend. Around 56 per cent of smartphone owners and 53 per cent of tablet owners used these devices to assist with their shopping. The study was carried out by Prosper Insights & Analytics with a sample of 4,330 people on November 25-26 and has a margin of error of 1.5 percentage points. (AFP)

US Black Friday: More shoppers but less spent per head

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US economy sees 3% growth in the second quarter, boosted by consumer spending

US consumer spending in December at historic low, reveals government data

US Black Friday: More shoppers but less spent per head