WASHINGTON – The nation’s economy picked up speed in the third quarter, growing at the fastest pace since 2003, based on final figures released today by the U.S. Department of Commerce’s Bureau of Economic Analysis.
The U.S. real gross domestic product – adjusted for inflation – grew at an annual rate of 4.9 percent in the third quarter, picking up speed from the second quarter’s 3.8-percent rate, the BEA said in its final report for the July to September period.
The third-quarter figure – unchanged from the “preliminary” report the BEA released last month (READ MORE) – matched the median forecast from a Bloomberg News survey of 72 economists. (Their estimates had the economy growing between 4.7 percent and 5.2 percent.)
Real gross domestic purchases – purchases by U.S. residents of all goods and services, wherever they were produced – rose an inflation-adjusted 3.3 percent in the third quarter (down from 3.4 percent in the preliminary estimate), accelerating from the second-quarter’s 2.4-percent increase.
The price index for gross domestic purchases – a measure of prices paid by U.S. residents – increased a revised 1.8 percent in the third quarter (up from 1.6 percent in the preliminary estimate) after rising 3.8 percent in the second quarter. The core index excluding food and energy rose a revised 1.9 percent (up from the preliminary estimate’s 1.7 percent), accelerating from the second quarter’s 1.5-percent gain.
Real PCE – personal spending adjusted for inflation – increased a revised 2.8 percent (up from the previous estimate of 2.7 percent), doubling the second quarter’s 1.4-percent rise.
Since then, however, the subprime mortgage collapse has deepened the housing slump and roiled financial markets.
“You can hear the screech and see the skid-marks of the economy slowing down from the third to the fourth quarter,” Stuart Hoffman, chief U.S. economist at PNC Financial Services Group Inc. in Pittsburgh, told Bloomberg News. “We’re going to go from this supercharged rate to ‘somebody slammed on the brakes.’”
Additional information, including the final Gross Domestic Product and Corporate Profits report, is available from the U.S. Department of Commerce’s Bureau of Economic Analysis at www.bea.gov.
