December 2014 Economic Indicators
Melanie Garza - Director of Operations
December 2014 – Economists say the U.S. economy has grown at its fastest rate in over a decade. The U.S. Department of Commerce adjusted its original report regarding third quarter GDP, stating that the economy grew 3.9% versus its first report of 3.5%. In the second quarter GDP hit a 4.6% growth rate recovering from a disappointing -2.1% performance in the first quarter.
Both non-residential fixed investments and personal consumption expenditures (PCE) surpassed the original estimate in the third quarter. Private industry investment also performed better than first reported; however, its rate of growth slowed in the third quarter.
Surprisingly, federal government spending and gross investment rose nearly 10% in the third quarter, compared to a decrease of 0.9% in the second quarter. National defense spending is on the rise touting a 16% increase.
Consumer Sentiment Peaks
Consumer Sentiment reached its highest level since July 2007 according to the University of Michigan Consumer Sentiment index. Consumer Sentiment hit 89.4 slightly revised down from its original forecast.
Since its beginning in 1978, consumer sentiment is now 4% above the average reading. The average reading since its inception is 85.1, and during non-recessionary years the average is 87.4. In times of recession, the average is 69.3.
This reading is in line with the recent report from The Conference Board regarding consumer confidence, as it hit a seven year high in October, at 94.5.
Questions or comments? Please contact Melanie Garza at mgarza@teamCOACT.com.