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.
—Andrew Michaels, editorial associate