The picture won’t be pretty for third-quarter economic growth, but it should get better

The picture won’t be pretty for third-quarter economic growth, but it should get better

The U.S. economic recovery slowed sharply in the previous three months, as products remained stranded at normally bustling ports, employers struggled to find workers and consumers battled with rising prices. When the Commerce Department releases Thursday its first estimate for third-quarter annualized gross domestic product growth, it likely will show an increase of just 2.8%, according to Dow Jones estimates. While that kind of number would have seemed perfectly fine in pre-Covid times, it actually would be the slowest pace since the recovery began in April 2020 off the in U.S. history. Moreover, there's a chance the economy didn't grow at all in the quarter — the Atlanta Fed's tracker lowered its estimate to 0.2%, with the most recent downgrade the result of a lowered outlook for government spending and real net exports. Economists aren't worried, however. They largely say the slowdown is the result of factors, principally related to supply chain bottlenecks, that will ease in the months ahead and allow the recovery to continue. "The weakness is a function of supply distortions more than anything," Natixis chief economist for the Americas Joseph LaVorgna said. "The economy is still fundamentally strong, and I wouldn't look at this one quarter