U.S. Economy Out Of Recession

The United States economy has come out of recession, concluding the third quarter of 2009 with the first positive results after three consecutive quarters of decline. The U.S. Department of Commerce yesterday announced that the world"s premier economy had grown 3.5 per cent in July - September 2009, thus sending out a strong message that the worst recession since 1930 had ended and the economy was recoverying.

This is the first time that the U.S. gross domestic product has grown since the Spring of 2008. Analysts expect the recovery to be slowed down by rising unemployment and the difficulties encountered by both consumers and businesses in taking loans.

The 3.5 per cent growth achieved by the U.S. economy exceeds the 3.3 per cent anticipated by most analysts. Due to the economic stimulus programmes adopted by the Government, consumers have started buying homes and cars again, thus stimulating recovery.

The U.S. Federal Reserve is expected to maintain the currently low level of the key rate for the year to come in order to further facilitate economic recovery, analysts believe.

After a severe 6.4 per cent decline in the first quarter of 2009, the world"s largest economy started to recover in response to stimulus schemes worth tens of billions of dollars and other forms of governmental support. Consequently, the pace of the recession decreased to 0.7 per cent in the second quarter.

Nevertheless, Federal Reserve Chairman Ben Bernanke and members of President Barack Obama"s economics team have warned that the recovery will not be robust enough to prevent the unemployment rate -- now at a 26-year high of 9.8 per cent -- from rising further next year. Economists believe that the unemployment rate will probably increase to 9.9 per cent by the end of October and then to 10.5 per cent by mid-2010. The U.S. Government is expected to release the first estimates of the unemployment rate in October sometime next week.

The National Bureau of Economic Research (NBER) officially determined that the U.S. economy entered the recession in December 2007. Even though the economy returned to positive figures in the third quarter of 2009, the NBER is still the official reference as to the start and finish dates of the recession.