WASHINGTON – The economy is growing modestly, with consumers too wary about spending to invigorate the recovery.
That picture emerged Tuesday from reports on the nation’s economy and the confidence of consumers, who power 70 percent of it. The economy grew at a 2.8 percent rate last quarter — less than originally estimated. And forecasts for the current quarter are for similarly slight growth before a drop-off next year.
The main reasons are that consumers remain reluctant to spend, commercial construction has slipped and imports are dampening U.S. growth.
The Commerce Department’s new reading on gross domestic product was weaker than the 3.5 percent growth rate for the July-September period estimated just a month ago. The GDP, which measures the value of all goods and services produced in the United States, also was a tad weaker than the 2.9 percent growth rate that economists surveyed by Thomson Reuters had expected.
At the same time, the Conference Board’s latest survey of consumer confidence found that as retailers enter the crucial holiday season, shoppers remain gloomy. Unemployment and tight credit have sapped consumers’ willingness and ability to spend freely.
Also Tuesday, the Standard & Poor’s/Case-Shiller home price index of 20 major cities suggested that the housing market’s recovery is continuing, if only gradually. Home prices rose slightly in September. Compared with a year earlier, though, they remain down 9.4 percent.
Just like the bogus “jobs created or saved” numbers – the Obama Administration continues to politicize the numbers …. GDP growth was overstated by 35% and home sales – which are repeatedly touted as being “up” are in fact down between 9% and 10% from last year – one of the worst years on record ………