The massive scope of the storm -- at more than 900 miles across, Sandy was the largest tropical system ever recorded in the Atlantic Ocean -- helps explain why the damage was so widespread. Slamming ashore in the most heavily populated region of the country, where 10 states have declared a state of emergency, means the storm could leave a measurable hole in this quarter's growth, economist say.
Insured losses alone will run from $7 billion to $15 billion, according to an estimate published late Tuesday by AIR Worldwide, a catastrophe modeling firm. That does not include uninsured propertie and publicly owned infrastructure such as roads and bridges.
"The effect on growth for the fourth quarter will not be catastrophic but might still be noticeable, especially in an economy with little momentum anyway," said IHS Global economists Gregory Daco and Nigel Gault in a research note.
But the economic hit in the short run will be heavily offset by the boost in spending and hiring that will accompany cleanup and rebuilding efforts in the weeks and months ahead.
“Hurricane Sandy will undoubtedly hit economic output in the short-term,” said Paul Ashworth, chief U.S. economist at Capital Economics. “(But) some of that output will be made up before the end of the current quarter, and when we factor in the boost to GDP growth from the cleanup, the overall economic impact is likely to be very modest.”
The massive scope of the storm -- at more than 900 miles across, Sandy was the largest tropical system ever recorded in the Atlantic Ocean -- helps explain why the damage was so widespread. Slamming ashore in the most heavily populated region of the country, where 10 states have declared a state of emergency, means the storm could leave a measurable hole in this quarter's growth, economist say.
Insured losses alone will run from $7 billion to $15 billion, according to an estimate published late Tuesday by AIR Worldwide, a catastrophe modeling firm. That does not include uninsured propertie and publicly owned infrastructure such as roads and bridges.
"The effect on growth for the fourth quarter will not be catastrophic but might still be noticeable, especially in an economy with little momentum anyway," said IHS Global economists Gregory Daco and Nigel Gault in a research note.
But the economic hit in the short run will be heavily offset by the boost in spending and hiring that will accompany cleanup and rebuilding efforts in the weeks and months ahead.
“Hurricane Sandy will undoubtedly hit economic output in the short-term,” said Paul Ashworth, chief U.S. economist at Capital Economics. “(But) some of that output will be made up before the end of the current quarter, and when we factor in the boost to GDP growth from the cleanup, the overall economic impact is likely to be very modest.”
