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Qatar National Bank expects the sector to remain steadfast Consumption In the coming months, household budgets will continue to provide support for consumption, as a result of the positive effects of wealth and the labor markets continuing to provide abundant opportunities, which reduces the possibility of a sharp decline in the American economy.
The bank said, in its weekly report, that the consumption sector is one of the main drivers of the American economy, adding that household spending represents about 68% of gross domestic product, according to what the Qatar News Agency (QNA) reported on Saturday.
The report indicated that this sector is considered the most vital in American economyas it provides important information regarding the general prospects of the economy, and the possibility of a soft or sharp decline.
The report identified two main factors that will continue to support consumption in the coming months:
- The first factor is that families have abundant resources to continue spending, and a strong balance sheet capable of continuing to support consumption.
- The second factor is that labor markets remain tight, and indicators of decline remain modest compared to the clear warning signs of recession. The rate has been reached The unemployment -According to the latest data- 3.9%, which shows some gradual decline.
Regarding the first factor, the report explained that during the Corona pandemic, families built their savings at an exceptional rate, as a result of the closures, in addition to government stimulus packages that pumped $5 trillion into the economy.
The report said that household net worth statistics provide important information regarding assets and liabilities, to evaluate the balance sheet of households in the United States, indicating an increase in household net wealth in the second quarter of 2023, by $5.5 trillion, to reach $154.3 trillion, which indicates – according to… The report – on the financial solvency of American families.
The report found that in the absence of a major correction in asset prices, the strong influence of wealth and the abundance of available resources will continue to support consumption resilience.
The rise in the value of US stocks by $2.6 trillion and the increase in the value of real estate by $2.5 trillion had a direct impact on increasing the total wealth of families during the second quarter of this year.
In the third quarter of this year, the US economy achieved growth of 4.9%, which is the fastest pace in nearly two years thanks to the growth in consumer spending due to rising wages.
Consumer spending increased by 4% during the third quarter of this year, which is the highest growth rate since 2021.
The US economy grew by 2.1% in the second quarter of this year.
The Qatar National Bank report came at a time when official data yesterday indicated a slowdown in American consumer spending in October, in exchange for a slight increase in unemployment benefits.
Consumer spending in the United States increased by 0.2% last October, after rising 0.7% last September, according to Reuters.
