US growth in the third quarter was affected by a new wave of infections due to the delta variant of COVID-19 during the summer as well as by global shortages affecting a large number of products.
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GDP, between July and September, grew by 2% at an annual rate, compared to the previous quarter and so is expected to develop over the whole year at that rate. That’s three times lower than it was in the second quarter, which jumped 6.7%.
Compared to the third quarter of 2020, growth was 4.9%, similar to that of China, which slowed sharply. And if we simply compare the second quarter, as the eurozone countries do, the growth is only 0.5%.
US President Joe Biden hopes to secure long-term prosperity for the United States by pushing Congress through two major investment plans, still under discussion, spanning a decade.
However, the US economy rebounded between April and June, until it regained its pre-pandemic size, spurred by vaccination and family savings accumulated during containment.
But during the summer, “the emergence of COVID-19 cases has led to new restrictions and delays in reopening businesses in some areas of the country,” the Commerce Department said in its Thursday statement.
However, Americans have taken advantage of the summer season to travel abroad again, benefiting GDP.
On the other hand, they spend less on cars and their parts.
Rather, it is the “main problem,” according to economist Joel Narov, who asserts that “demand is there, but not supply.”
Indeed, auto factories are slowing down due to a shortage of semiconductors, and the sector, like many others, has been suffering for months from global supply difficulties.
These disruptions worsened during the summer when the highly contagious delta variant spread across the country, slowing activity. Then consumers abandoned restaurants, planes, hotels, and more.
He also sent many people back to work, fearing for their health, even though the country was already facing a serious labor shortage.
So some restaurants have had to reduce opening hours. Side deliveries, lack of drivers weighs. And not all Christmas toys might hit store shelves on time.
These difficulties, along with strong demand from American consumers, are driving up prices.
But good news, the level of inflation, although still high, slowed down in the third quarter to 5.3% on an annual basis, compared to 6.5% in the second quarter, according to the personal consumption expenditures index.
The Biden administration sees inflation falling “by half or the end of next year.”
But to the Republican opposition, these numbers are “further evidence that President Biden is spoiling the recovery,” and raise “serious questions about his ability to restore our economy,” said Kevin Brady, the committee’s number two Republican. responsible for taxes. issues in the House of Representatives.
He believes that this policy “exacerbates the worrying shortage of manpower”, while the promised investments will “push prices higher and for a longer period.”
To ensure long-term growth and jobs, Joe Biden announced Thursday that he has presented Congress with a “historic plan” that includes billions of dollars to spend on social and environmental measures.
But he did not mention a formal agreement for these investments, whose envelope has shrunk by half compared to initial ambitions to $1.750 billion. In order to be able to adopt the plan without a Republican vote, he must already secure the support of all Democrats in the Senate, without exception.
Steny Hoyer, the second Democrat in the House of Representatives, said in a statement that Joe Biden’s plans “represent an important investment in the future and competitiveness of our economy.”
In addition to social and environmental spending, Congress must also ratify a second plan of nearly $1,000 billion aimed at modernizing infrastructure.
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