At the onset of 2023, optimism for a prosperous year was scarce among economists. In fact, many had anticipated a recession by this point.

However, as the government prepares to unveil its preliminary estimate of the third-quarter gross domestic product on Thursday, expectations are set for a robust 5% annual growth rate.

This surpasses the 2.1% recorded in the second quarter and serves as a testament to the resilience of consumer activity.

Even Federal Reserve Chairman Jerome Powell has acknowledged the surprising vitality of the U.S. economy while presiding over a record series of interest rate hikes initiated early last year, US News reported.

Nevertheless, Powell has cautioned that stronger-than-expected economic data, especially regarding the labor market, may intensify the pressure to further raise interest rates or maintain them at elevated levels.

Powell will receive an update on the Federal Reserve’s progress on inflation when the personal consumption expenditures price index is disclosed on Friday.

This less-publicized measure of inflation is closely monitored by Powell and other Fed officials.

Economists anticipate the core index, which excludes energy and food prices, to show a decline in September to an annual rate of 3.7%, down from 3.9% in August but still notably above the Fed’s 2% target.

Written by staff