US Economy Grows at Record Pace, With an Asterisk

GDP expands at 33% annual rate after previous quarter's plunge
By John Johnson,  Newser Staff
Posted Oct 29, 2020 7:42 AM CDT
Economy Just Set a Record, but There's a Catch
Shoppers and pedestrians walk through a concourse at the American Dream Mall in East Rutherford, N.J., on Oct. 1.   (AP Photo/Kathy Willens, File)

The last major report card on the economy before the election is out, and expect to hear President Trump making a big deal out of it. The Commerce Department reported Thursday that the economy grew at a record annual rate of 33% in the third quarter, per the AP. As NPR reports, normally a figure like that for the gross domestic product would be seen as a "blockbuster." But this one comes with an asterisk because of COVID—in the previous quarter, the GDP shrank by 31%. Here is how one analyst sums things up for the Wall Street Journal: "This is the quarter that captures the reopening of the economy,” says Tim Quinlan of Wells Fargo Securities. "It’s a far cry from signaling the all-clear that the economy’s in great shape here.”

Still, Politico notes that it's a "badly needed positive headline" for Trump with less than a week to go before voting ends. On the campaign trail this week, Trump has been heralding a "V-shaped" recovery. "Wait till you see that number on GDP," Trump said Monday. "We're having a super-V." However, forecasters say the current quarter will not keep up this pace, though they do expect growth to continue, per the Journal. At this point, the economy has recovered about two-thirds of what it lost in the current recession, reports CNBC. The lack of a COVID stimulus package out of Congress may dampen further recovery, the outlet notes. (More GDP stories.)

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