The United States economy grew slightly faster than initially estimated in the third quarter, according to revised government data released on Thursday, while corporate profits were also adjusted higher.
Gross domestic product (GDP) expanded at a revised annualised rate of 4.4% in the July–September period, up from the previously reported 4.3% pace and marking the fastest growth since the third quarter of 2023, the Commerce Department’s Bureau of Economic Analysis (BEA) said in its updated estimate.
Markets had expected GDP growth at 4.3%. The economy expanded at a 3.8% pace in the second quarter.
The modest upward revision reflected stronger exports and business investment, while imports, which subtract from GDP, were also revised higher.
Consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose at a 3.5% rate in the third quarter.
However, underlying domestic demand showed some softening. Final sales to private domestic purchasers, a key measure of internal demand, increased at a 2.9% rate, revised down from the previously estimated 3.0%.
The BEA said the rise in real GDP reflected increases in consumer spending, exports, government spending and investment, while imports declined during the quarter.
“Compared to the second quarter, the acceleration in real GDP in the third quarter reflected upturns in investment, exports, and government spending, as well as an acceleration in consumer spending. Imports decreased less in the third quarter than in the second,” the BEA said.
The report noted that real final sales to private domestic purchasers - which combine consumer spending and gross private fixed investment - rose 2.9% in the third quarter after being revised down by 0.1 percentage point from the previous estimate.
Data collection for the report was affected by the 43-day government shutdown that began on 1 October.
The disruption forced the BEA to delay its initial third-quarter estimate until 23 December and skip a second estimate altogether.
Economic activity has taken on what has been described as a K-shaped pattern, with higher-income households and large corporations driving growth.
A strong stock market and elevated home prices have helped shield wealthier households from inflation, while lower- and middle-income consumers face fewer options to substitute purchases.
