AI-related investment, consumers likely boosted US economic growth in third quarter
SPY•US GDP likely grew at a 3.2% annualized rate in the third quarter, up from 2.2% in the second, as consumer spending and AI-related business investment offset a trade deficit that may have subtracted at least 4 percentage points.
1. Growth forecast accelerates
US economic growth likely accelerated in the third quarter, with GDP forecast to rise at a 3.2% annualized rate, according to a Reuters survey of economists. The Commerce Department was set to publish its advance estimate on Thursday.
2. Investment and trade
Consumer spending and AI-driven business investment were likely the main growth drivers. Business equipment spending was expected to post a third consecutive quarter of double-digit growth, while the trade shortfall was estimated to subtract at least 4 percentage points from GDP growth; inventories probably added to growth.
3. Consumers remain resilient
Consumer spending, which accounts for more than two-thirds of the economy, was projected to grow at more than a 3% pace after rising at a 3.8% rate in the second quarter. Economists expected households to pull back as gasoline prices remained above $4 a gallon, while rising mortgage rates were expected to push residential investment back into contraction.
