The U.S. economy grew at a vigorous pace through the end of September, despite the uncertainty created by tariffs and widespread concerns about affordability among households.
Economic growth rose at a 4.3. percent annual rate in the third quarter, the Commerce Department reported Tuesday, an acceleration from the previous quarter.
The third-quarter readingshows that, even in the face of negative consumer sentiment and a softening job market, the roughly $30 trillion economy started October on relatively solid footing as a whole, outperforming the bearish expectations of some experts only months before.
The strong growth “reflected increases in consumer spending, exports, and government spending that were partly offset by a decrease in investment,” according to the Bureau of Economic Analysis.
That the economy has remained strong is the latest indication that President Trump’s tariffs have not had the giant depressive effect that many economists had once feared. Although tariffs have undoubtedly raised the costs of some goods, consumers have continued to spend. Consumption, which constitutes roughly 70 percent of the economic pie in a typical year, rose at a 3.5 percent annualized pace in the quarter.
Lower-income families are wrestling with slowing wage growth and rising costs of various household goods, like beef, coffee and furniture. Still, even as some major corporations have announced work force reductions, the limited extent of overall layoffs is still buttressing activity. And much of consumption growth has come from spending by affluent and upper middle-class Americans, who have continued paying for travel, recreation, restaurants and other discretionary purchases.
Talmon Joseph Smith is a Times economics reporter, based in New York.
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