The U.S. economy rose at the fastest rate on record in the third quarter of 2020 as the economy recovery took hold. Real GDP in the third quarter was close to the pre-recession level, but further recovery is needed.
According to the “advance” estimate released by the Bureau of Economic Analysis (BEA), real gross domestic product (GDP) increased at an annual rate of 33.1% in the third quarter of 2020, following two consecutive decreases in the first quarter (-5.0%) and the second quarter (-31.4%). This quarter’s rate marked the fastest growth rate on record since the quarterly GDP data first was tracked in 1947 and was above NAHB’s forecast of a 25.6% increase.
The COVID-19 recession is singular. In the second quarter of 2020, national shutdowns and restrictions plunged the U.S. economy into the worst recession since World War II. In the following quarter, from July to September, reopening economic activities strengthened the U.S. economy significantly and real GDP grew at an unprecedented pace. However, the recovery remains incomplete, with additional gains challenged as the COVID-19 cases increase and uncertainty grows over health, policy and economic factors.
The increase in real GDP in the third quarter of 2020 reflected
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