"The U.S. economy grew at a surprisingly strong 4.3% annual rate in the third quarter, the most rapid expansion in two years, as government and consumer spending, as well as exports, all increased.U.S. gross domestic product from July through September - the economy's total output of goods and services - rose from its 3.8% growth rate in the April-June quarter, the Commerce Department said Tuesday in a report delayed by the government shutdown."
"Analysts surveyed by the data firm FactSet forecast growth of 3% in the period.However, inflation remains higher than the Federal Reserve would like. The Fed's favored inflation gauge - called the personal consumption expenditures index, or PCE - climbed to a 2.8% annual pace last quarter, up from 2.1% in the second quarter.Excluding volatile food and energy prices, so-called core PCE inflation was 2.9%, up from 2.6% in the April-June quarter."
"In a slow holiday trading week, U.S. markets on Wall Street turned lower following the GDP report, likely due to growing doubts that another Fed rate cut is coming next month.Consumer spending, which accounts for about 70% of U.S. economic activity, rose to a 3.5% annual pace last quarter, up from 2.5% in the April-June period.Consumption and investment by the government grew by 2.2% in the quarter after contracting 0.1% in the second quarter."
U.S. gross domestic product increased at a 4.3% annual rate in the third quarter, the fastest expansion in two years and up from 3.8% in the prior quarter. Consumer spending accelerated to a 3.5% annual pace, representing roughly 70% of economic activity. Government consumption and investment rose 2.2%, aided by state, local and federal defense outlays. The personal consumption expenditures index climbed to 2.8% and core PCE reached 2.9%, both higher than the previous quarter. Elevated inflation reduced the likelihood of an imminent Federal Reserve rate cut and pressured equity markets.
Read at Fast Company
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