This confirmation comes in parallel with the strong optimism surrounding the September US retail sales report, as well as the upward revisions related to the August report, which support the possibility that the US retail sales GDP growth increased by 4% in the third quarter.
In the same context, the American consumer continues to face financial difficulties despite all expectations that this improvement is not clear or inevitable.
US consumers resilience comes with the fact that GDP growth increased by 4%
With monthly gains estimated at around 7%, the US retail sales report for September beat expectations in a positive way, when the most optimistic reports indicated a possible increase of only 0.3.
Retail sales for August also achieved an increase of 0.8, while expectations indicated a possible increase of only 0.6.
While reports attribute this increase to the value of the dollar and the rise in gasoline prices, even if their impact was slight, as gas station sales increased by 0.9 compared to the previous month
The improvement in car sales also led to a monthly increase of 1% for cars and spare parts.
The Miscellaneous , which is known for its constant volatility as it recorded a decline of 3.6% in August and another of 1.4% in July, received its share of this recovery, as it rose significantly by 3% on a monthly basis.
Non-store retailers also had a good month, with a 1.1% increase in sales contributed to by Labor Day weekend sales.
Read more Federal Budget Deficit Expands to 8.6% of GDP
The control group also performed well with a monthly increase of 0.6, although this increase is not surprising since the control group aligns closely with consumer spending trends.
All these increases confirm that GDP growth in the third quarter may achieve a jump of up to 0.4%. All of these numbers, combined with strong employment numbers and rising inflation, highlight the potential for Treasury yields to rise significantly.
While Federal Reserve officials may agree that there is no need to raise interest rates, the possibility of lowering interest rates remains remote.
Once again, economists are providing inaccurate forecasts in the direction of market growth, as the decreasing trend in consumer confidence is at the forefront of the reasons leading to this, along with the increasing anxiety generated by families when it comes to the economic outlook in addition to the potential fluctuations that always affect the labor market, The impact of inflation on each family’s purchasing power is also a key factor in this.
The approach followed by the Bureau of Economic Analysis in publishing data on credit card spending transactions, which witnessed a significant decline in September, on a weekly basis is one of the most important reasons behind this miscalculation. While this data provides a comprehensive analysis and view of overall spending patterns, considering the different case for car sales, this disconnect is surprising, as it seems unlikely that there will be a widespread return to cash trading soon.
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