The U.S. economy grew at a solid annual rate of 3.5% in the July-September quarter, auguring well for its long-term health and ability to boost growth worldwide.
Bloomberg reported that the Commerce Department reported the good news Thursday, with 3.5% growth better than economists had expected.
The U.S. economy expanded more than forecast in the third quarter, validating the optimism that prompted Federal Reserve policy makers to stop pumping money into financial markets.
Gross domestic product grew at a 3.5 percent annualized rate in the three months ended September after a 4.6 percent gain in the second quarter, Commerce Department figures showed today in Washington. It marked the strongest back-to-back readings since the last six months of 2003.
Government outlays and a shrinking trade deficit boosted growth last quarter, buying time for consumer spending in the world’s largest economy to strengthen as fuel prices drop and hiring picks up. Fed officials yesterday cited the improvement in the job market in deciding to end their bond-buying program and stay on course toward interest rate increases next year.
The economy “is on a firm footing, and if the labor market continues to get better, that’s the primary support to consumer spending,” said Brian Jones, a senior U.S. economist at Societe Generale in New York, who correctly forecast the growth in GDP. “The demand side of the equation was very healthy in the third quarter.”
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