The nation's economy continued to grow at a brisk clip in the third quarter, slowing down from the prior period but still beating forecasts.
Gross domestic product [1] (GDP) in the United States increased at an annualized rate of 3.5 percent last quarter, according to an advance estimate from the Bureau of Economic Analysis [2] (BEA). Economists surveyed by Econoday anticipated a growth rate of 3.0 percent.
The third quarter's economic advance compares to an annualized 4.6 percent growth rate in the second quarter and a contraction of 2.1 percent in the first quarter.
According to BEA, the increase in real GDP last quarter largely stemmed from contributions from consumer spending, exports, nonresidential fixed investment, and government spending at all levels. Except for federal government spending—which picked up significantly—growth decelerated across all of those categories, resulting in the lower overall rate of expansion compared to Q2.
The GDP report comes a day after the Federal Reserve announced plans to close down its stimulative bond-buying program, signaling increased confidence in the economy's progression.
Whatever progress the Fed thinks the country has made, consumers might not be feeling as confident. According to Thursday's report, consumer spending increased 1.8 percent in the third quarter, dropping from a pace of 2.5 percent in Q2. Meanwhile, personal income rose $152.9 billion, down from $223 billion as wage and salary growth slowed.
Thursday's report from BEA is the first of three the agency will release on third-quarter GDP. The next estimate, based on more complete data than what is available now, is scheduled for November 25.