Growth slower, jobs down

The US economy probably slowed in the third quarter and employers hired fewer workers in October, indicating expansion was losing momentum even before the partial government shutdown, economists expect reports to show this week.

The US economy probably slowed in the third quarter and employers hired fewer workers in October, indicating expansion was losing momentum even before the partial government shutdown, economists expect reports to show this week.

Gross domestic product (GDP) grew at a 2 per cent annualised rate after a 2.5 per cent pace from April to June, according to the median forecast of 69 economists surveyed by Bloomberg.

Consumer spending was probably the weakest since 2011. Payrolls rose by 125,000 workers after a 148,000 gain in September.

A drop in government output and restrained business and consumer purchases due to the 16-day shutdown last month have prompted economists to trim fourth-quarter growth forecasts.

Tepid hiring and a jobless rate that's projected to have climbed in October help explain why US Federal Reserve policymakers are pressing on with stimulus.

The GDP report may show consumer spending, which is 70 per cent of the economy, grew at a 1.6 per cent annualised rate, the slowest since the second quarter of 2011.

Related Articles