GDP bottom line: Unlikely to impact the Fed upcoming decisions

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GDP bottom line: Unlikely to impact the Fed upcoming decisions
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Consumers have been a driving force behind the American economy, leading to its most robust pace of growth since early 2021. In the third quarter, the

economy expanded seasonally, and the inflation-adjusted annual rate was 4.9%. This growth rate exceeded the expectations of economists, who estimated GDP to grow at 4.7% for the same period, more than double the pace seen in the second quarter, which was at 2.1%. Of course, markets are a forward-looking machine where it's expected the economy's resilience may face challenges soon.

GDP figures are backward-looking compared to more timely monthly data, such as inflation and employment numbers. The consensus expectation is that the Fed will keep interest rates unchanged at their current 22-year high. This decision allows policymakers more time to assess the impact of their previous rate hikes and recent events, such as the sharp bond market sell-off. However, the GDP data serve as a reminder of the underlying strength of the U.S.

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