US Economic Growth Rises In Q3

The U.S. economy expanded at an annual 2.1% pace in Q3 instead of 2.0% according to revised government data. Economists were expecting a reading of 2.2%, according to a Wall Street Journal poll.

Consumer spending and private inventory investment mostly accounted for the upward revision, the Commerce Department said Wednesday. The report was a revision of an advance estimate issued last month.

Inflation-adjusted gross domestic product increased as inventories added more than 2.1 percentage points to overall growth in the third quarter.

The median GDP estimate in a Bloomberg survey of economists had forecast a minor upward revision to 2.2%.

The report underscores how a combination of a surge in Covid-19 infections, supply shortages and labour constraints induced a sharp slowdown last quarter in personal consumption.

Recent data, including stronger-than-expected October retail sales, suggest a re-acceleration of spending in the final three months of the year.