US Economy Grows 3.4%, Fastest Pace in a Year

The US economy grew faster than expected in the third quarter, posting its strongest expansion in a year. Growth was supported by robust business investment and resilient consumer spending.

Inflation-adjusted gross domestic product (GDP) expanded at an annualized rate of 3.4% in the three months through September, accelerating sharply from 2.2% growth in the second quarter.

The result also exceeded market expectations. Economists had projected growth of around 3.2% for the third quarter, indicating that US economic activity remained solid despite elevated interest rates.

However, stronger economic growth was accompanied by renewed inflationary pressure toward the end of the quarter. The Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s preferred inflation gauge, rose 0.5% in September, marking its largest monthly increase in six months.

Meanwhile, Core PCE, which excludes food and energy prices, increased 0.3%. The combination of stronger-than-expected economic growth and persistent inflationary pressure could keep the Fed cautious about easing monetary policy and preserve the possibility of further tightening.(mrv)

Source : Newsmaker.id