23 Dec 2016
Real gross domestic product (GDP) advanced at an annual rate of 3.5 percent in the third quarter of this year, the fastest quarterly growth since 2014. The growth rate was revised up from the second estimate of 3.2 percent. In the second quarter, the economy grew by 1.4 percent.
"In this third estimate for the third quarter, nonresidential fixed investment, personal consumption expenditures (PCE), and state and local government spending were revised up from their previous estimates," Xinhua reported the Commerce Department as saying.
Consumer spending, which accounts for about 70 percent of the U.S. economy, increased 3.0 percent in the third quarter, stronger than the previously reported 2.8 percent increase, but moderated from a 4.3 percent surge in the second quarter.
Nonresidential fixed investment rose 1.4 percent in the third quarter, faster than a 1.0 percent increase in the second quarter. It contributed 0.18 percentage point to economic growth in the third quarter.
The solid economic expansion, coupled with improvement in labor market and inflation conditions, encouraged the U.S. Federal Reserve to raise interest rates this month after a near one-year pause.
Fed officials projected that the U.S. economy will grow 1.9 percent this year and 2.1 percent next year, both up by 0.1 percentage point from their September forecast.
With the election of Donald Trump, U.S. economic policies are likely to see significant changes, which could have substantial impact on the U.S. and global economies.
Despite the uncertainty over the president-elect's policies, markets now expect tax cuts and increased government spending from the new administration, which could push up inflation and longer-term interest rates in the United States.
Fed officials are now seen hiking interest rates three times next year, compared with only twice in 2017 in their September projection. (A026)
Editor: Unggul Tri Ratomo
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