Bloomberg Economics predicts a 4.9% p.a. growth for the US economy, higher than the 4.5% average estimate, the highest in two years. This third-quarter boom is attributed largely to summer travel and entertainment spending by consumers. This includes the blockbuster returns of ‘Barbenheimer’ and of course Taylor Swift and Beyonce’s concert and merchandising revenue.

Does this mean good news for investors?

A growing US economy does bode favourably for global economies and ultimately investors, as the dollar is considered a stable haven.

However, economists doubt whether this rate of growth is sustainable and predict a shallow recession for the next quarter. While consumers are spending more than last year, their excess cash is dwindling, and household savings are under pressure.

Also, the strong labour market that bolsters the economy is expected to decline and encourage a recession that the Fed has been trying very hard to avoid. It’s a death-defying balancing act that could go either way.

Regardless of the outcome, now is not the time for sudden investment decisions, but to stay the course and trust in a well-diversified portfolio to ride the economic storm over the long term.