The United States experienced a rise in personal income and GDP, a decrease and an increase in consumer confidence, and a decrease in the unemployment and the inflation rates. These facts show that the economy was slowly progressing out of the 1990-91 recession.
The year 1993 was part of the 1991 to 2001 expansionary period. Since the recession trough in the first quarter of 1991, personal income for the nation increased at an annual rate of 4.6% according to the U.S. Department of Commerce.
The Gross Domestic Product rose in the third quarter by an annual rate of 2.8% and about 4% in the fourth quarter.1 This rise was due to consumer spending, new home construction, and business purchases of capital goods.
During the first quarter of 1993, the United States experienced a drop in consumer confidence, which was a concern for the economy. This drop was an indication that consumers were worried about higher taxes in the future and a lack of job growth.2 Clinton did increase taxes, which fulfilled consumers' expectations.
As the year progressed, consumer confidence began to rise. Throughout the year the unemployment rate continued to fall from 7.3% in the first quarter to 6.5% in the fourth. In October the national index of consumer confidence rose to 82.7, which was higher than the September reading of 77.9. This index steadily moved upward after July, which showed that consumers were once again gaining confidence.3
During 1993, the inflation rate dropped from 3.2% early in the year to 2.8% in July and August. Overall for the year, the economy experienced a 3% inflation rate. “During 1993, the Federal Open Market Committee called for 'maintaining the existing degree of pressure on reserve positions' at each of its meetings, and the federal funds rate remained fairly constant at around 3 percent.”4