US economy rebounds with 2.6 percent growth rate in third quarter
U.S. economic growth rebounded during the third quarter after six months of steady declines, according to data released Thursday by the Commerce Department.
U.S. gross domestic product (GDP) grew at annualized rate of 2.6 between July and September, up from declines of 1.6 percent in the second quarter and 0.6 percent in third quarter of 2022, the Bureau of Economic Analysis reported Thursday.
That means that if the third quarter’s pace of growth lasted 12 months, the U.S. economy would have grown 2.6 percent by the end of that time.
Economists expected U.S. GDP to rise at an annualized rate of 2.3 percent in the third quarter, according to consensus estimates.
The stronger than expected GDP report comes amid increasing concerns about whether the U.S. will slip into a recession next year amid high inflation, a slowdown in Europe, and rising Federal Reserve interest rates. While economists still fear the U.S. could hit a recession next year, the GDP rebound is further proof that the American economy had avoided one so far.
The third quarter GDP increase was driven almost entirely by a surge in exportswhich add to GDP calculationsand steep decline in imports, which detract from GDP. The trade dynamic shifted rapidly from the first and second quarters, when surging imports and declining exports turned GDP growth negative despite strong activity elsewhere in the economy.
Consumer spending also held firm during the third quarter, rising 1.4 percent after an increase of 2 percent during the second quarter.
Even so, the strong headline numbers masked other signs of the U.S. economy slipping in key sectors. Hillicon Valley Disinformation effort targets US ahead of midterms On The Money Debt ceiling showdown could send US into tailspin
Gross private domestic investment, a catch-all category for money spent on things meant to grow the economy, fell 8.5 percent in the third quarter. The decline came as spending on structures sank 15.3 percent and spending on homes plunged 26.4 percent on the quarter.
Final sales to private domestic purchasers, which measures business spending, also rose just 0.1 percent on the quarter.
Updated at 9:14 a.m.
