U.S. economy grew by 3% in second quarter
Transcript:
(00:00) the US economy grew by 3% in the second quarter year-over-year beating expert forecast that's according to an estimated reading the final figures are expected next month investopedia's editor-in Chief Caleb silver joins us now to break all this down so like you always do help us understand these figures and what they mean for the health of our economy yeah this is gross domestic product pretty much sums up all the uh the production we do all the sales consumer spending and it's growing this is the second estimate 3% get this
(00:29) it was 1.4% of the first quarter so some surge in growth between quarters all driven by consumer spending we're not buying houses that wasn't residential spending it was consumer spending out in storage where we know those prices have been high so that's a good sign the economy growing at least we're not looking at recessionary numbers right now but we are keeping an eye on other things like the jobs Market we got weekly jobless claims about 230,000 those have been steadily Rising every single week but the GDP report that's
(00:55) the big headline number that's a good sign and we were talking about the the Federal Reserve expected to meet coming up is that September 18th yeah September 18th the FED will meet and they will lower interest rates probably a quarter point that has been the expectation that is sort of what the Federal Reserve and uh chairman Jay pal have guided he said as much last week probably a quartero cut then maybe another quartero cut as we get to that meeting that's near the election I think it's November 7th
(01:18) pretty close to the election but interest rates are coming down we know this we like to see the economy growing we like to see inflation leveling out and we got the personal consumption expenditures index report today the fed's preferred gauge of inflation 2.5% we're bang on right there so this is a good sign for headline numbers and we know rates are coming down all this confirms that you seem so confident that the rates are coming down is there anything that could derail that U no except a big spike in unemployment when
(01:44) we get the new jobs numbers that would just mean a deeper cut to interest rates but Fed chal was very clear last Friday at the Jackson hle Symposium the end of high interest rates is coming it's time for a new regime that means lower interest rates expect interest rates to be between four and 5% next year and then between three and 4% the year after that great news for people trying to buy a home mortgage rates are coming down great news for people trying to finance a car those rates are coming down and
(02:09) the big one credit card aprs they've been Skyhigh 24% those will come down to some debt relief in the form of lower interest rates is coming these numbers all sort of point to that direction so that positive number we've got the 3% growth does that have any direct impact on consumers or will we have to wait to the FED for the FED to drop those interest rates before other people will see this no that is driven by consumer we have to spend to keep this economy moving in this country and we're pretty
(02:33) good at it even though credit card debts at a record high all this driven by the fact that consumers are doing okay record number of 401k millionaires by the way because of the rise in the stock market wow all right fascinating stuff Caleb silver thanks for explaining that thanks for watching stay updated about breaking news and top stories on the NBC News app or follow us on social media