US GDP growth picks up in third quarter

US gross domestic product expanded at an inflation- and seasonally adjusted 2.9% annual rate in the third quarter, the Commerce Department said Friday.

This reading comes above a 2.5% rise expected and follows a 1.4% pace of growth in the second quarter. Q3 growth rate was the fastest recorded in two years.    

“The acceleration in real GDP growth in the third quarter reflected an upturn in private inventory
investment, an acceleration in exports, a smaller decrease in state and local government pending, and an upturn in federal government spending. These were partly offset by a smaller increase in PCE, and a larger increase in imports,” said the Commerce Department.

The price index for personal consumption expenditures rose at a 1.4% seasonally adjusted annual rate in the third quarter, above the 1.3% expected. PCE prices rose at a 2% rate during the second quarter. When excluding volatile food and energy costs, the price index increased at a 1.7% rate in the third quarter, above the 1.6% expected.