By Evelina M. Tainer, Chief Economist, Econoday
November 1, 2002

Good news was hard to find on the economic front this week. Real GDP did expand at a 3.1 percent rate in the third quarter, boosted primarily by a surge in consumer spending. Construction expenditures rose because of new residential housing. Analysts are wondering how much longer the consumer can keep the economy going. The employment cost index rose slightly less than expected - and it bodes well for the inflation-conscious. Those key monthly indicators that hint about the prospects for the current quarter were not so hot. The labor market has stalled. Manufacturing is in a declining mode again. The talk of the town is whether or not the Fed will break down and reduce its federal funds rate target at Wednesday's FOMC meeting (November 6).