US economic growth accelerates in third quarter
SPY•US GDP grew at a 3.4% annualized rate in the third quarter, above economists’ 3.2% forecast. Consumer spending rose 3.8%, while higher gasoline prices could curb household spending.
1. Growth beats forecasts
US gross domestic product increased at a 3.4% annualized rate in the July-September quarter, the Commerce Department’s Bureau of Economic Analysis said in its advance estimate. Economists had forecast a 3.2% pace, with estimates ranging from 1.0% to 4.2%.
2. Spending and rates
Consumer spending, which accounts for more than two-thirds of the economy, rose at a 3.8% pace, matching the second quarter. The report said resilient consumer spending and AI-driven business investment offset the impact of higher oil prices. Economists anticipated that gasoline prices above $4 a gallon could slow consumer spending; households have also been saving less and drawing on nest eggs. The Federal Reserve left its benchmark interest rate in the 3.75%-4.00% range and said inflation remains elevated.
