There are several reasons that his goal is probably far-fetched, namely the country’s aging work force and slower population growth than in the past. Combine that with low productivity growth, and hitting Mr. Trump’s target begins to look like a Sisyphean challenge.
The president also suggested that other economies overseas were growing at two or three times the American rate. “You look at other countries and what their G.D.P. is, they are unhappy when it is 7, 8, and 9,” he said.
Still, with personal consumption accounting for nearly 70 percent of economic output, the new willingness of shoppers to open their wallets is a good sign.
“The economy is stronger than you think,” said Chris Rupkey, the chief financial economist at Mitsubishi UFJ Financial Group in New York. “Bet on it.”
The improvement was driven in large part by strong consumer activity, with purchases of durable goods like automobiles and appliances rising strongly. Increased business spending also helped lift the latest estimate above Commerce Department’s initial reading of 2.6 percent for the quarter.
The surge in consumer spending stands in stark contrast with the problems plaguing brick-and-mortar stores like Sears and Macy’s, which have been forced to close dozens of locations this year amid fierce competition from online retailers like Amazon.com.
The government’s data reflects all purchases, whatever the retail channel, which explains why malls and street-level stores may be suffering even as consumers become more bullish and the broader economy powers ahead.
Most economists are expecting the economy to expand at a rate of roughly 3 percent in the second half of 2017. That pace should be strong enough to keep job growth and wages on track for further gains, while keeping the threat of inflation modest for now.
Besides wild cards like Hurricane Harvey’s impact on a broad swath of the Gulf Coast, and political uncertainty about issues like tax overhaul and a possible increase in infrastructure spending, traders are also keeping…