WASHINGTON, Dec. 22 (Xinhua) -- The U.S. economy grew at an annual rate of 2.3 percent in the third quarter of the year, up from a 2.1 percent pace estimated a month ago, according to revised data released by the U.S. Commerce Department on Wednesday.
Despite the upward revision, it marked a significant slowdown of U.S. economic growth from the pace of 6.7 percent in the second quarter, due to the Delta variant-fueled COVID-19 surge and the decline in government support.
"The deceleration in real GDP (gross domestic product) in the third quarter was led by a slowdown in consumer spending. A resurgence of COVID-19 cases resulted in new restrictions and delays in the reopening of establishments in some parts of the country," the department said.
In the third quarter, government assistance payments in the form of forgivable loans to businesses, grants to state and local governments, and social benefits to households all decreased, according to the department.
"Real GDP revised slightly higher but still tepid over summer as Delta wave struck & support from government waned ... The fourth quarter is almost done and Omicron wave likely to impact end of December," Diane Swonk, chief economist at major accounting firm Grant Thornton, said Wednesday on the Twitter.
"I worry the most about layoffs for low wage workers that were hit hardest by onset of pandemic. They are the most vulnerable now that government support has evaporated. We will see businesses closed both to shear number of ill workers & fear of contagion. The pullback started," Swonk said.
White House officials are carefully watching the economic impact of the latest COVID-19 surge, but they have not requested additional federal funding. They are optimistic that the COVID-19 relief package enacted in March provides policymakers with the financial flexibility to mitigate the economic damage that might be caused by the new variant, according to The Washington Post.
However, Mark Zandi, chief economist of Moody's Analytics, told the Post that odds are uncomfortably high that the U.S. economy may in fact contract at the start of next year. Enditem
