Look under the bonnet and the US economy is in for a rough ride | Phillip Inman

However confident the Fed is of recovery, there is growing evidence of a slide into outright deflation

Hurricane Harvey was such a distraction last week that Donald Trump forgot to tweet about his country's return to 3% GDP growth. When the news came that US second-quarter GDP, when extrapolated over a year, showed the country growing at the fastest rate in the G7, he was busy flying down to Texas to support the relief effort.

Trump and his Treasury secretary Steve Mnuchin have promised to deliver 3%-plus growth and here was the first indication that the president's arrival in the White House had made a difference. In a way, it is just as well he missed the opportunity to brag. The headline figures may look good, but a peek under the bonnet of the US economy makes for disturbing reading. In a report last week a senior City analyst, Albert Edwards, showed that the Trump effect is quite the opposite and much of the life has been sucked out of the American economic juggernaut in the last six months.

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