The US economy grew a stellar 4.9% from July through September, driven by robust consumer spending despite the Federal Reserve’s efforts to slow the economy with high-interest rates.
Thursday’s estimate from the Commerce Department showed that the nation’s gross domestic product — the broadest gauge of the economy’s total output of goods and services — was the fastest quarterly advance in nearly two years.
Last quarters robust GDP growth was far above the 2.1% growth rate in the April-to-June quarter.
Despite inflation, the Commerce Department reported that Americans drove the economy by stepping up their spending, splashing out on everything from movies and Taylor Swift concert tickets to restaurant meals.
However, the economy is expected to experience a steady slowdown in the current October-to-December quarter and into early 2024, especially if the Fed implements another interest rate hike and the housing market remains sluggish.
A recent survey by CNBC-Morning Consult showed just that, with more than three-quarters of respondents, 76%, saying they plan to be frugal through the holidays.
Of the 4,403 US adults polled last month, 62% said they plan on budgeting sometimes or more often in the upcoming six months, CNBC found — during retailers all-important holiday shopping season.
On top of sky-high borrowing rates currently plaguing the housing market — the average long-term rate hit 8% for the first time since 2000 last week, per Mortgage Daily News — some 30 million Americans began repaying student loans, which could slow their ability to spend in the fourth quarter.
Those loan repayments had been suspended since the pandemic first struck three years ago.
Brisk consumer spending typically leads companies those that sell physical goods as well as those, like restaurants and entertainment venues, in the economys vast service sector to raise prices, thereby fueling inflation.
Fed officials have acknowledged the pickup in growth, which could potentially undercut their efforts to fight inflation, which rose 3.7% in September.
Last month’s advance was more than economists expected — and a sharp decline from June 2022’s four-decade high of 9.1% — though it’s still well above central bankers’ 2% goal.
A blockbuster September employment report revealed that the US economy added a whopping 336,000 jobs last month an unexpected surge that contradicts the notion the Fed may tamp down its aggressive tightening regime.
However, it still remains unclear whether the latest GDP figure will have much impact on the Fed’s upcoming Nov. 1 decision on interest rates, which officials have suggested may increase one more time ahead of the new year.
Fed Chari Jerome Powell said in a discussion at the Economic Club of New York last week: “We certainly have a very resilient economy on our hands.”
“Many forecasts called for the US economy to be in recession this year. Not only has that not happened; growth is now running for this year above its longer-run trend. So thats been a surprise,” he added.
If those trends continue, it could allow the Fed to achieve a highly sought-after soft landing, in which the central bank would manage to slow inflation to its 2% target without causing a deep recession.
At the same time, Powell has suggested that if the economy keeps growing robustly, the Fed might have to raise rates further. Its benchmark short-term rate — which affects the rates on many consumer and business loans — currently sits between 5.25% and 5.5%, a 22-year high.
Last month, Fed officials unanimously decided to hold the record-high rate steady for the second time in six policy meetings so far this year.
“Additional evidence of persistently above-trend growth could put further progress on inflation at risk and could warrant further tightening of monetary policy,” Powell said last week.
The biggest city in the Sahel has been ransacked and left in ruins.
War erupted in Sudan’s capital Khartoum in April 2023 and sent millions searching for safety.
The city was quickly captured by the paramilitary Rapid Support Forces (RSF) after a power struggle with the Sudanese Armed Forces (SAF) for total control.
At least 61,000 people were killed from the fighting and siege conditions in Khartoum state alone.
Thousands more were maimed and many remain missing.
The empty streets they left behind are lined with charred, bullet-ridden buildings and robbed store fronts.
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The once shiny skyscrapers built along the confluence of the River Nile are now husks of blackened steel.
The neighbourhoods are skeletal. Generational homes are deserted and hollow.
Image: Damage from fighting around Khartoum
Trenches snake the streets where copper electric cables were ripped out of the ground and pulled out of lampposts now overridden with weeds.
The majority of the 13 million people displaced by this war fled Khartoum. Many left in a rush, assuming it would only take a few weeks for peace to be restored.
My parents were among those millions and in the midst of the abandoned, looted homes is the house where I grew up.
Image: Yousra Elbagir’s family home was left in ruins by RSF troops
Image: Yousra said it was likely a bomb had previously fallen nearby and shaken the house at its base
A shell of a home
I have to strain my eyes to see the turn to my house. All the usual markers are gone. There are no gatherings of young people drinking coffee with tea ladies in the leafy shade – just gaping billboard frames that once held up advertisements behind cars of courting couples parked by the Nile.
Our garden is both overgrown and dried to death.
The mango, lemon and jasmine trees carefully planted by my mother and brother have withered.
Image: Structural damage to the outside of the home
The Bougainvillea has reached over the pathway and blocked off the main entrance. We go through the small black side door.
Our family car is no longer in the garage, forcing us to walk around it.
It was stolen shortly after my parents evacuated.
The two chairs my mum and dad would sit at the centre of the front lawn are still there, but surrounded by thorny weeds and twisted, bleached vines.
Image: How the home looked before Sudan’s war
Image: And how it looks now
The neighbour’s once lush garden is barren too.
Their tall palm trees at the front of the house have been beheaded – rounding off into a greyish stump instead of lush fronds.
Everyone in Khartoum is coming back to a game of Russian roulette. Searching out their houses to confirm suspicions of whether it was blasted, burned or punctured with bullets.
Many homes were looted and bruised by nearby combat but some are still standing. Others have been completely destroyed.
Image: How the home looked before the war
Image: And how it looks now
The outside of our house looks smooth from the street but has a crack in the base of the front wall visible from up close.
It is likely a bomb fell nearby and shook the house at its base – a reminder of the airstrikes and shelling that my parents and their neighbours fled.
Inside, the damage is choking.
Most of the furniture has been taken except a few lone couches.
The carpets and curtains have been stripped. The electrical panels and wiring pulled out. The appliances, dishes, glasses and spices snatched from the kitchens.
Image: Yousra shows her mother pictures found in the home
The walls are bare apart from the few items they decided to spare. Ceilings have been punctured and cushions torn open in their hunt for hidden gold.
The walls are marked with the names of RSF troops that came in and out of this house like it was their own.
The home that has been the centre of our life in Sudan is a shell.
Image: Sudan’s war has left the country fractured
Glimmers of hope
The picture of sheer wreckage settles and signs of familiarity come into focus.
A family photo album that is 20 years old.
The rocking chair my mother cradled me and my sister in. My university certificate.
Image: Yousra finds her university certificate in the wreckage
Celebratory snaps of my siblings’ weddings. Books my brother has had since the early nineties.
The painting above my bed that I have pined over during the two years – custom-made and gifted to me for my 24th birthday and signed by my family on the back.
There are signs of dirt and damage on all these items our looters discarded but it is enough.
Image: Yousra’s parents pictured at home before they fled Khartoum
Evidence of material destruction but a reminder of what we can hope will endure.
The spirit of the people that gathered to laugh, cry and break bread in these rooms.
Image: A portrait of Yousra’s grandmother damaged by RSF troops
The hospitality and warmth of a Sudanese home with an open door.
The community and sense of togetherness that can never truly be robbed.
What remains in our hearts and our city is a sign of what will get us through.
A few days later, I spoke to Mr Zelenskyy in person when he confided to me that maybe he would have to step down if NATO could guarantee Ukraine membership – a man who perhaps sensed he could never win against a hostile Mr Trump.
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5:07
Sky News meets Zelenskyy: The key moments
Yet, fast-forward to last weekend in Rome, and an iconic picture of the two men in close conversation at the Pope’s funeral.
This time round, it is Russian President Vladimir Putin on the receiving end of the presidential anger, blaming him for the fact that “too many people are dying!”
Image: Trump and Zelenskyy talk in the Vatican. Pic: AP
To Trump’s supporters, this is the smart negotiator, constantly repositioning himself as new information comes in, prior to pulling off a spectacular deal.
To his many detractors, it indicates a dangerous incoherence that is replicated in other key areas, including tariffs as well as his relationship with his allies in Europe and his foes in Beijing.
Flexible or fallible; in control or all at sea? In the fast and furious world of Donald Trump, it’s almost impossible to call.
The only constants are his unwavering self-belief, or as the man himself says: “I aim very high, and then I just keep pushing and pushing and pushing to get what I’m after.”
A paramedic in Gaza who was detained for more than five weeks following an Israeli attack that killed 15 aid workers has been released, the Palestinian Red Crescent Society (PRCS) said.
Asaad al Nsasrah was one of 17 aid workers who were attacked in Tel al Sultan in southern Gaza by Israeli forces on 23 March.
Asaad was one of two first responders who survived – the other 15 were killed.
He was initially thought to be missing, as his body was not among the dead. It was not until 13 April, three weeks after the attack, that Israel confirmed Asaad was alive and in Israeli detention.
The PRCS announced Asaad’s release on X and shared a video of him reuniting with colleagues.
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Sky News has seen images showing Asaad, among other released Palestinians, in a grey tracksuit at al Amal Hospital in Khan Younis, where he is undergoing medical examination, according to the PRCS.
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19:54
How two hours of terror unfolded
The PRCS claimed the Israeli military’s investigation was “full of lies”.
Asaad’s voice can be heard in a video, initially published by the New York Times, that shows the moments leading up to the attack on the aid workers.
The video was discovered on Rifaat Radwaan’s phone, which was found on his body by rescue workers five days after the attack.
Among those killed were one UN worker, eight paramedics from the PRCS and six first responders from Civil Defence – the official fire and rescue service of Gaza’s Hamas-led government.
The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We gather, analyse and visualise data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling we aim to better explain the world while also showing how our journalism is done.