US GDP Rebounds With 33.1 Pct Annual Increase
The Bureau of Economic Analysis reported on Thursday (Oct. 29) that real gross domestic product (GDP) rose at an annual rate of 33.1 percent in Q3 2020 as part of its “advance” estimate.
The bureau indicated that a rise in Q3 GDP reflected ongoing efforts to reopen businesses and restart activities that were delayed or limited because of the pandemic, according to a press release.
However, the bureau noted that the complete economic impacts of the coronavirus can’t be numerically expressed in the Q3 2020 GDP estimate “because the impacts are generally embedded in source data and cannot be separately identified.”
The climb in real GDP showed rises in private inventory investment, personal consumption expenditures, nonresidential fixed investment, exports and residential fixed investment, which were partially offset by declines in federal, state and local government spending.
The bureau cautioned that the GDP estimate released on Oct. 29 is based on source information that is either not complete or is subject to additional modification by the source agency. But a second Q3 estimate built on more comprehensive information is slated for a Nov. 25 release.
The news comes as the GDP fell by 31.4 percent in Q2 (as measured quarter over quarter), which was a few basis points better than the 31.7 percent that had been forecasted in the past. The GDP was previously forecasted to accelerate by 30 percent (annualized) in Q3. That comes on the heels of businesses reopening, supply chains springing back into action and people returning to physical businesses.
As previously noted, a 30 percent rally in GDP for the September report, if achieved, would be far ahead of the past 16.7 percent growth record that was registered in 1950.
“The world is coming back from the depths of its collapse in the peak of this crisis, which was the first half of this year,” Gita Gopinath, chief economist and director of the research department at the IMF, said in a mid-October virtual press conference.