The Charging Bull sculpture is seen near Wall Street in Manhattan's financial district. Thursday's report noted that consumer spending in the U.S. increased by 1.6% in Q3, a sharp decline from the 12% rise in Q2. File Photo by John Angelillo/UPI | License Photo
Oct. 28 (UPI) -- The U.S. economy grew only marginally during the third quarter of 2021, the Commerce Department said in its quarterly report Thursday -- a significant slowdown compared to markedly solid growth in each of the first two quarters.
The department's report said the domestic economy grew between July and October at a 2% annual growth rate, which was lower than the 2.7% rate most economists expected.
The first two quarters of 2021 saw overall growth of 6.3% and 6.7%, respectively. The Q3 growth in gross domestic product, a measure of the total output of U.S. goods and services, was the slowest in more than a year.
Thursday's was the department's first estimate of third-quarter growth. A more complete assessment, based on additional data, will be issued on Nov. 24.
"The increase in third quarter GDP reflected the continued economic impact of the COVID-19 pandemic," the department said in a statement.
"A resurgence of COVID-19 cases resulted in new restrictions and delays in the reopening of establishments in some parts of the country. Government assistance payments in the form of forgivable loans to businesses, grants to state and local governments, and social benefits to households all decreased."
Another major influence that slowed Q3 growth, experts say, are ongoing supply chain issues that have disrupted global economies for months. The supply issues are resulting in limited inventories that businesses can sell to customers, across virtually all industries.
Thursday's report also noted that consumer spending in the United States increased by 1.6% over the past three months, a sharp decline from the 12% rise in the second quarter. Disposable income fell by 0.7% and personal saving rates by 1.6%.
Businesses recently urged Congress to take greater actions to shore up problems in the supply chains, which are being driven by multiple factors, but most significantly COVID-19.