Natural disasters take a physical toll on impacted
communities, the most recent example being the severe flooding from Hurricane
Florence in North Carolina. With destruction and devastation comes economic
hardship, but according to Moody’s Analytics, Hurricane Florence is expected to
have a minimal impact on the U.S. economy. The latest hurricane hit the East
Coast late last week and is responsible for at least 32 deaths as of Tuesday.
On Sept. 18, USA Today
reported Moody’s analysis of the storm’s impact on the country’s economic
growth, which predicts a drop of one to two tenths of a percentage point this
third quarter. If economists’ earlier predictions are correct, the economy
could still see expansion of about 3.7%; however, Oxford Economics anticipates
slightly worse conditions, with a decline of two to three tenths of a percentage
point. Moody’s and Oxford currently expect damage totals of $16 to $20 billion
and $30 to $40 billion, respectively.
“Most of the lost economic output is likely to be made up in
the fourth quarter as consumers make purchases they deferred and replace damaged
vehicles, and repairs begin on effected homes and businesses,” USA Today reported.
Oxford Chief U.S. Economist Greg Daco said in the article
that drops are possible in retail and services as well as manufacturing. While
consumers may spend less on clothing, toys and jewelry, restaurants are likely
to still see businesses. Hurricane Florence may also put a dent in industrial
production in addition to overall employment, the latter of which is likely to
bounce back in October or November.
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