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US out of recession...for now

Jeegar Kakkad October 29, 2009 12:51

The US economy grew at an annualised rate of 3.5% in third quarter.

So while the UK shrank by 0.4% between June and September, the US economy grew by just under 0.9% quarter on quarter.

What helped the US?

Well, their $3bn cash-for clunkers scheme ran for a month in August - that accounted for about a third of the growth.

Another big boost came from a slower run down of inventories.

The inventory cycle is likely to continue to provide a boost to the economy, but since the clunkers scheme was scrapped, auto sales and production have slumped. That'll weigh heavily on the fourth quarter prospects.

The question for most economists and retailers will be whether the Christmas season will be a festive or a miserable one for the economic outlook.

 

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Growth

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