The United States Economic Forecast 4th Quarter 2021

Despite the pandemic, the economy has continually improved since 2020, heading into Q3 2021. However, experts are worried that the current Delta variant will retrogress the country’s economy in Q4. TPIN experts take a critical look at the primary economic indicators, GDP,

Unemployment, and Inflation, to determine if the country’s outlook in Q4 will worsen or improve. But first, let’s look at

Q3 economic indices.

Q3 AND Q2 U.S. ECONOMIC OUTLOOK

The United States Economy recovered tremendously in Q3 of 2021, spreading by a record 33.8%. Despite the huge milestone, the expansion wasn’t enough to mitigate earlier economic losses, which is the 5% drop in Gross Domestic Product in Q1. In Q2, the economy contracted by 31%. Never in the history of the United States has the economy contracted by more than 10%. At least, since record-keeping started in 1947.

In Q3, retail sales rose 0.6%, though lower than the 18.3% increase in May in the 2020 hit-recession year. In Q3, particularly in June, the unemployment rate maintained a steady rate of 5.9%, averaging 394,000 jobs. Compared to Q3 last year in June, the unemployment rate was double digits,

starting from April, although it declined steadily going forward. This proves that Q3 recorded significant growth in the job sector and the GDP.

Q4 ECONOMIC OUTLOOK PREDICTION

In a recent report released by Federal Open Market Committee FOMC in June, the committee predicts that the U.S. GDP will grow by 7% in Q4 and drop to about 3.5% in 2022. The GDP will contrast further to 2.4% in 2023, but this is all speculation. It could worsen, and on the other hand, it could improve.

The FOMC also predicts that the last quarter will have a 4.5% unemployment rate, which will decline in subsequent years to 3.8% and 3.5% in 2022 and 2023, respectively. The committee anticipates that more workers will recover their jobs by that time as the pandemic declines. In terms of job creation, the Bureau of Labor Statistics projects that six million jobs would be created from 2019-2029. However, the body didn’t factor in the pandemic during the time of the publishing.

The BLS also predicts more jobs in e-commerce, transportation, computer-based occupations, and health care. However, sectors like agriculture, postal service, manufacturing and retail services, and information-based industries will decline in jobs. Overall, the job market will look stronger in Q4 upwards.

The oil and gas prices will remain stable throughout Q4 of 2021, considering that a barrel for Brent crude oil averaged $73 in June. However, the United States EIA anticipates a decline in 2022. The forecast, however, doesn’t include renewable energy, as this could change the outcome of things.

Mortgage rates will likely hover around 3% in Q4 of 2021. However, the Fed is making sure that the rates remain flexible to encourage borrowing and consumer spending. In a bid to make this happen, the Fed would purchase mortgage-backed securities and treasury. This will slow down supply in the Treasury market, which will keep the benchmark for fixed rates low.

While the reports for Q4 are healthy, the labor market is still far from recovering the 22 million jobs it has lost due to the Coronavirus. However, there’s no denying the fact that the U.S. economy is on a recovery path. Moreover, with more healthy economic policies implemented, especially in real estate and businesses, the U.S. economy will recover even further.

The economic outlook for Q4 is healthy, and this means well for the real estate market. So take advantage of the opportunity to get home, especially with the low interest rate. Contact Eric L. Frazier for assistance with purchasing a home or investment property. Eric L. Frazier MBA is a licensed Mortgage Advisor NMLS 461807 and can be reached at 800-261-1634 ext. 703.

ABOUT THE POWER IS NOW MEDIA, INC.

The Power Is Now Media is an online multimedia company founded in 2009 by Eric L. Frazier, MBA, headquartered in Riverside, California. We advocate for homeownership, wealth building, and financial literacy for low to moderate-income and minority communities. The Power Is Now Media corporate office is located at 3739 6th Street Riverside, CA 92501. Ph: 800-401-8994 Website: www.thepowerisnow. com.

Eric Lawrence Frazier, MBA. President and Founder, The Power Is Now Media

References

https://www.thebalance.com/us-economicoutlook-3305669 https://www.bls.gov/emp/ https://www.spglobal.com/ratings/en/research/ articles/210624-economic-outlook-u-s-q3-2021sun-sun-sun-here-it-comes-12014595 https://www.thebalance.com/fomc-meetingsschedule-and-statement-summaries-3305975 https://www.eia.gov/outlooks/steo/report/prices.php