U.S. economy grows 2.8 percent in third quarter

Email|Print|Comments       twitter     facebook     Sina Microblog     reddit    

WASHINGTON, Nov. 7 -- The U.S. economy increased at an annual rate of 2.8 percent in the third quarter before the 16-day partial government shutdown, boosted by private inventories and residential fixed investment, the Commerce Department reported Thursday.

This is a welcome acceleration from the 2.5 percent growth rate in the second quarter. In the first quarter, U.S. real gross domestic product (GDP) gained 1.1 percent.

The increase in real GDP in the third quarter primarily reflected positive contributions from personal consumption expenditures (PCE), private inventories, exports, residential fixed investment, nonresidential fixed investment, and state and local government spending, which were partly offset by a negative contribution from federal government spending, the department said.

Real PCE rose 1.5 percent in the third quarter, compared with an increase of 1.8 percent in the second quarter, the report noted.

Personal consumption accounts for about 70 percent of overall U.S. economic activity, making it the main engine of economic growth.

Private inventories contributed 0.83 percentage point to the quarterly GDP growth, more than the 0.41 percentage point contribution in the previous quarter, the report said.

Net exports of goods and services contributed 0.31 percentage point to the quarterly GDP growth, after subtracting 0.07 percentage point from economic growth in the second quarter.

Against the backdrop of a housing sector recovery, residential fixed investment contributed 0.43 percentage point to the quarterly GDP growth, more than the 0.4 percentage point contribution in the prior quarter, according to the report.

Real federal government consumption expenditures and gross investment decreased 1.7 percent in the third quarter, after declining 1.6 percent in the second quarter. Real state and local government consumption expenditures and gross investment increased 1.5 percent, after rising 0.4 percent in the previous quarter, the department said.

• Economy prepared for turning of US policy tide
• US economy unexpectedly shrinks in 4th quarter of 2012
• Payroll tax to blame for U.S. consumer confidence nose-dive: economists
• U.S. federal debt to GDP ratio to reach 200 pct by 2040: report
• U.S. oil rises on economic growth optimism
• U.S. Congress passes 50.5-bln-USD Sandy relief
• U.S. House budget chief says automatic spending cuts likely
• U.S. fixed mortgage rates move higher
• U.S. jobless claims dip to five-year low
• News Analysis: U.S. economy looking up despite Washington drama

We Recommend

• Fire guts 22-storey Nigeria commercial building in Lagos
• U.S. Navy Carrier Strike Group stages military exercises
• Volkswagen showcases new energy vehicles in Beijing
• How should we get married nowadays?
• Commentary:
  Stop Phubbing
• Jakie Chan sees Rubber Duck off in Beijing
• Hello! Horror Halloween Celebration!
• The catwalk to the world of fashion
  
• Cruise trip to Taiwan