Natural Disaster Recovery Sparks Jump in Consumer Spending

In the wake of major hurricanes in Texas, Florida, and Puerto Rico, Secretary of Commerce Wilbur Ross announced a 3% increase in Gross Domestic Product (GDP) for the 3rd quarter of 2017. In particular, consumer spending jumped one percent in September alone, one of biggest increases in nearly a decade. According to the Commerce Department’s advanced estimates, personal income and savings were down, but disposable income rose $73.6 billion.

Secretary Ross noted that: “Today’s release of the gross domestic product growth for Q3 2017 proves that President Trump’s bold agenda is steadily overcoming the dismal economy inherited from the previous Administration. This is a remarkable achievement in view of the recent hurricanes which have shattered so many lives. As we work together to help those areas recover, I am confident that they will rebound stronger than ever before.  And as the President’s tax cut plan is implemented, our entire economy will continue to come roaring back.”

Commerce data on consumer spending and GDP comes at a time when overall use of consumer credit is down. With the majority of Americans living paycheck to paycheck, the next leader of the Federal Reserve will need to set a monetary policy that encourages healthy economic growth and consumer spending in the coming months.