U.S. economic growth picked up slightly in the third quarter, rather
than slowing as initially reported, amid a stronger pace of inventory
accumulation and a less steep decline in business investment.To get more news about
us gdp, you can visit shine news official website.
Gross domestic product increased at a 2.1% annualized rate, the Commerce
Department said in its second estimate of third-quarter GDP on
Wednesday. That was up from the 1.9% pace estimated last month.The
economy grew at a 2.0% pace in the April-June period. Economists polled
by Reuters had forecast third-quarter GDP growth would be unrevised at
1.9%.
When measured from the income side, the economy grew at a 2.4% rate in
the last quarter. Gross domestic income (GDI) increased at a rate of
0.9% in the second quarter. The income side of the growth ledger
accelerated despite a drop in profits.
After-tax profits without inventory valuation and capital consumption
adjustment, which corresponds to S&P 500 profits, decreased $11.3
billion, or at a rate of 0.6%, as they were held down by legal
settlements with Facebook and Google. Profits increased at a 3.3% rate
in the second quarter.
The average of GDP and GDI, also referred to as gross domestic output
and considered a better measure of economic activity, increased at a
2.3% rate in the July-September period, quickening from a 1.4% growth
pace in the second quarter.There are signs the economy slowed early in
the fourth quarter amid a cooling in consumer spending and a deepening
downturn in business investment.
The Trump administration’s trade war with China has eroded business
confidence, contributing to the second straight quarterly contraction in
business investment. The fading stimulus from last year’s $1.5 trillion
tax cut package is also sapping momentum from the expansion, now in its
11th year.
Growth has slowed from the 3.1% rate notched in the first three months
of the year. But the risks of a recession in the near term have subsided
as the housing market has rebounded from last year’s soft patch, driven
by lower mortgage rates.
The Federal Reserve last month cut interest rates for the third time
this year and signaled a pause in the easing cycle that started in July
when it reduced borrowing costs for the first time since 2008.Growth in
consumer spending, which accounts for more than two-thirds of U.S.
economic activity, was unrevised at a 2.9% rate in the third quarter.
Consumer spending is being supported by the lowest unemployment rate in
nearly 50 years. But moderating job growth, ebbing consumer confidence
and stalling wage gains are raising doubts about the consumer’s
resilience.
Business investment dropped at a 2.7% rate in the third quarter, rather
than contracting at a 3.0% pace as previously reported. The declines in
spending on nonresidential structures such as mining exploration, shafts
and wells, were not as steep as previously estimated.