WASHINGTON—According to the Commerce Department's second estimate for third quarter economic growth, the U.S. economy rebounded 33.1%, remaining unchanged from the initial estimate.
NAFCU Chief Economist and Vice President of Research Curt Long observed that while the dip from earlier this year was the most severe in history, the "recovery thereafter was also similarly record-breaking."
"Gains in the economy through September are undeniably encouraging," said Long. "The fact that GDP could nearly recover the entirety of the monumental losses from the first half of the year in a matter of months, even while tens of millions remain unemployed, testifies to the efficacy of the CARES Act.
"Aggregate numbers are prone to obscure the conditions of the working class even in normal times (and especially during COVID), and there is a lot of work to be done to meet the needs of the unemployed and small businesses," Long added. "But the economic engine has seen a remarkable recovery and shows no signs of slowing down."
Additional Updates
According to the updated estimate, contributions to growth of real GDP came from personal consumption (+25.2%) – with the majority of the gain coming from the services sector – and investment (+11.8%). Growth was reduced by net exports (-3.2%) and government consumption (-0.8%).
Of note, corporate profits jumped 27.1% after dropping more than 10% in each of the previous two quarters.
PCE inflation, the Fed's preferred inflation metric, rose 3.7%. Core PCE inflation (excluding food and energy) also increased, rising 3.5%, Long said.