Consumer spending continues to be robust!

The annual growth rate of the U.S. GDP for the last quarter has been revised to 3%, indicating that the economy still has resilience... Data released by the U.S. government on Thursday shows that the U.S. economy grew healthily at an annual rate of 3% in the last quarter, driven by strong consumer spending and business investment, which is faster than its initial assessment.

The second quarter real GDP annualized seasonally adjusted rate was revised up to 3%, expected to remain unchanged at 2.8%.

The second quarter core PCE price index annualized seasonally adjusted rate was revised to 2.8%, lower than the expected and previous value of 2.9%.

The number of initial jobless claims in the U.S. for the week ending August 24 was recorded at 231,000, lower than the expected 232,000, and the previous value was revised up from 232,000 to 233,000.

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U.S. Treasury yields rose after the data was released.

The 10-year U.S. Treasury yield rose by 0.7 basis points, reaching 3.848%.

The U.S. dollar index rose nearly 20 points in the short term, and the U.S. dollar rose nearly 80 points against the Japanese yen in the short term.

Spot gold fell by $10 in the short term, close to giving up all the intraday losses.

The U.S. Bureau of Economic Analysis explained in its press release that "compared with the first quarter, the acceleration of real GDP in the second quarter mainly reflected the rise in private inventory investment and the acceleration of consumer spending."

The slightly faster growth rate in the second quarter than initially reported mainly reflected an upward revision to consumer spending.

Consumer spending accounts for about 70% of U.S. economic activity, with an annual growth rate of 2.9% in the last quarter, higher than the initial estimate of 2.3%.

Business investment grew by 7.5%, with equipment investment growing by 10.8%.

Thursday's GDP report reflects that under the pressure of persistent high interest rates, although the U.S. economy is gradually slowing down, it still maintains resilience.

The report is the second estimate of the U.S. Department of Commerce for the growth of domestic gross product in the second quarter.

The Department of Commerce will release the final estimated data at the end of next month.

Before the presidential election in November, the economic situation has a great impact on voters.

Although the inflation rate has sharply declined after reaching the highest point in forty years in mid-2022, many Americans are still annoyed by high prices.

The Federal Reserve raised the benchmark interest rate 11 times in 2022 and 2023, raising it to the highest point in 23 years.

It is widely expected that the borrowing costs for consumers and businesses will increase significantly, leading to an economic recession.

However, the economy has been growing, and employers have been hiring.

Now, the inflation rate is only slightly higher than the Federal Reserve's 2% target level and may slow down further.

Federal Reserve Chairman Powell has basically announced victory over inflation.

Therefore, the market has fully priced in the Federal Reserve's readiness to start cutting interest rates at the next meeting in mid-September.

The Federal Reserve is now turning to gradual interest rate cuts with the aim of achieving a "soft landing," that is, trying to maintain a healthy job market while curbing inflation to avoid triggering an economic recession.

Compared with continuing to fight inflation, the Federal Reserve is more concerned about supporting the gradually weakening job market recently.

The unemployment rate has risen for four consecutive months, reaching 4.3%, although it is still relatively low by historical standards.

Job vacancies and hiring rates have also declined, but they are still at a relatively stable level.

The number of initial jobless claims has fallen from the 11-month high at the end of July, due to the temporary shutdown of auto factories and the dissipation of the impact of Hurricane Beryl.

They are still at a level consistent with the steady cooling of the labor market, which should help alleviate concerns about a rapid deterioration of the economy.

However, the re-employment opportunities for the unemployed are becoming fewer and fewer, indicating that the unemployment rate in August may still be high.