The U.S. economy cooled to a 2.7% annual growth rate during the third quarter, its slowest pace in 18 months, according to the Commerce Department.
In comparison, the economy grew at a 5.6% annual rate during the second quarter; a rate at which the vast majority of economists would say is too fast to be sustainable over the long term.
Most economists believe 3% is about the fastest rate at which the economy can grow over the long term, without sparking inflation.
Consequently, the slower pace of economic growth in the third quarter, ironically, could be viewed as good news for the RV industry. This is because the Federal Reserve Board raised interest rates on several occasions during 1999 and earlier this year to slow economic growth in order to stave-off inflation.
As a result, the slower third quarter growth rate reduces the chances that the Fed will raise interest rates during its next meeting on Nov. 15.
Higher interest rates have played a major role in the decision by RV dealers to reduce the size of their inventories in recent months.