"Second-quarter GDP expanded at a 3.8% annualized rate, a strikingly strong pace given the Federal Reserve's ongoing effort to tamp down inflation. The Atlanta Fed's GDPNow model suggests growth may be even stronger in the third quarter, forecasting 3.9% gains. Many economists had expected the lagging impact of high interest rates, tighter credit conditions, and April's "Liberation Day" market shock to drag growth meaningfully lower by now."
"Instead, the data tells a different story. Consumer spending has continued to prove resilient, and business investment, far from retreating, has strengthened in sectors tied to artificial intelligence, energy infrastructure, and manufacturing reshoring. Housing, often sensitive to interest rates, has shown surprising stability in key regional markets. Sløk did not dive into these particulars in Wednesday's edition of his Daily Spark, except to address slowing job growth. "This is the result of slowing immigration," he wrote, not economic weakness."
Consensus forecasts predicted a U.S. economic slowdown beginning in January, but those predictions repeatedly failed to materialize. Second-quarter GDP rose at a 3.8% annualized rate and the Atlanta Fed's GDPNow model estimates roughly 3.9% growth in the third quarter. Consumer spending has remained resilient while business investment has strengthened in sectors tied to artificial intelligence, energy infrastructure, and manufacturing reshoring. Housing markets have shown surprising regional stability despite higher interest rates and tighter credit conditions. Job growth has slowed, attributed primarily to declining immigration rather than overall economic weakness. Economists' repeated overestimation of near-term slowing highlights a pattern of misjudgment that warrants scrutiny.
Read at Fortune
Unable to calculate read time
Collection
[
|
...
]