- Department of Commerce
The US economy slowed sharply in the third quarter of 2015, reflecting a cutback in businesses' stockpiling of goods, while underlying demand remained healthy in the world's biggest economy. According to the Department of Commerce, the advanced estimate of third quarter GDP rose at an annualized rate of 1.5%, slightly missing a 1.6% growth forecast. The July through September reading marks a sharp deceleration from the second quarter, when the economy expanded at a 3.9% rate. Nevertheless, economists claim that the inventory drag, which was the main reason for steep decline in the pace of economic growth in the third quarter, is likely to be temporary. Therefore, the US GDP growth is expected to pick up in the fourth quarter given strong domestic fundamentals.
Meanwhile, weekly layoffs data from the US are showing no sign of slowdown in labour market trends, as a measure of jobless claims fell to its lowest level since 1973. As the Department of Labour revealed, initial claims for state unemployment benefits advanced 1,000 to a seasonally adjusted 260,000 for the week ended October 24. The recent economic data from the US confirms the Fed's words that domestic economy is expanding at a "moderate pace", while the possible December's rate hike is still on the table.
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