John Hugh DeMastri
Contributor
October 26, 2022 8:36 PM ET
Gross domestic product (GDP) is expected to spike in the third quarter, but that isn’t likely to help consumers in the long-term as they struggle with persistent inflation, economists told the Daily Caller News Foundation.
Trade generally propped up GDP in the third quarter, a trend unlikely to continue as a strong dollar makes foreigners less likely to purchase American goods.
“Consider the third quarter GDP to be last call at the bar,” said Heritage Foundation economist E.J. Antoni. “The party is over.”
Third quarter gross domestic product is likely to spike off the back of a narrowed trade deficit, but the result doesn’t necessarily spell good news for consumers battling persistent inflation, economists told the Daily Caller News Foundation.
After falling in the first two quarters of 2022, prompting significant debate about whether the U.S. had entered a recession, GDP in the third quarter is predicted to grow at an inflation-adjusted rate of 2.3% annually, according to a Wall Street Journal survey of economists. However, two economists told the DCNF that this is unlikely to forecast major improvements in consumers’ economic health, since the spike was mostly driven by trade trends that are unlikely to persist.
“Ordinarily, we think about increases in GDP as benefiting Americans, but that’s not always the case,” Heritage Foundation economist E.J. Antoni told the DCNF. “A rough metaphor [for the narrowing trade deficit] is a consumer being too poor to shop somewhere. It looks like international trade slowed down considerably in the third quarter, hardly a sign of prosperity.”
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https://dailycaller.com/2022/10/26/expected-gdp-spike-doesnt-spell-news-economists-say/
