WASHINGTON (Bloomberg) -- Growth in the U.S. economy should pick up in the third quarter, led by a surge in consumer spending, and with little sign of inflation, the National Association of Manufacturers said Thursday.
The economy grew at a 2.2 percent annual rate in the second quarter, after expanding at a 4.9 percent pace in the first quarter. However, "there is clear evidence of underlying strength" in third quarter growth, the association said in its periodic forecast of the economy.
Healthy job growth, as well as income and stock market gains, are "keeping spending buoyant" in the third quarter, the report said. "At the same time, equipment investment is continuing to post strong growth gains."
Recent U.S. data seems to bear the NAM forecast out. The national unemployment rate fell to 4.8 percent in July -- tying a 24-year low set in May -- while the economy added 316,000 new jobs.
While workers' average hourly earnings showed no change in July after rising 0.3 percent in June, and weekly earnings fell, personal in-comes rose 0.6 percent in June, double the rise of the previous month. Also, spending increased 0.3 percent. Disposable income, or the money left after taxes, increased 0.5 percent in June.
Moreover, stock prices are rising. After the Dow Jones industrials broke the 8000 mark last month, it didn't stop there, surging to a record close of 8259. …