The U.S. economy experienced strong growth in the third quarter, confirming a solid 2.8% annualized increase, according to the latest report from the Commerce Department’s Bureau of Economic Analysis. This figure remained unchanged from the initial estimate, reflecting robust consumer spending and business investment.
While economists had anticipated no change, the updated data showed slight downward revisions in consumer spending, government spending, and exports. These were offset by improvements in private inventory accumulation, business investments, and state and local government spending.
In comparison, the economy grew at a slightly higher 3.0% pace in the second quarter. Despite some cooling in the growth rate, the expansion remains above the Federal Reserve’s target non-inflationary growth rate of approximately 1.8%.
Consumer spending, which is responsible for more than two-thirds of U.S. economic activity, grew at a still-healthy 3.5% rate, though it was revised down slightly from the earlier estimate of 3.7%. A key measure of domestic demand—excluding government spending, trade, and inventories—showed an unchanged growth rate of 3.2%, up from 2.7% in the second quarter.
From the income perspective, the economy grew at a rate of 2.2%, with gross domestic income (GDI) slightly revised down to a 2.0% pace for the second quarter. Though GDP and GDI should theoretically align, the two often differ due to different data sources. To capture a clearer picture, the combined GDP and GDI growth rate, known as gross domestic output, was 2.5%, which was the same as in the previous quarter.
This latest data underscores the resilience of the U.S. economy, with domestic demand and business investment continuing to support growth despite global uncertainties and Federal Reserve tightening.
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