Economic growth in the United States picked up between July-September, the Commerce Department said Thursday, an encouraging sign that the nation’s economy continues to recover, albeit slowly.
Gross domestic product (GDP), the broadest measure of all the goods and services produced in an economy, grew at an inflation-adjusted annual rate of 2.5 percent in the third quarter, which ranges from July through September, the strongest performance in a year.
The GDP rate dipped slightly lower than economists’ expected 2.7 percent rise.
The economy grew a by a meager 0.4 percent in the first quarter and 1.3 percent in the second quarter of the year, from April through June, triggering concerns of a new downturn.
But in the last few months, consumers spent more on durable goods like cars and refrigerators and services, while business investment surged. Personal consumption expenditures up 2.4 percent, compared with only 0.7 percent in the preceding period.
Businesses also are investing, especially in equipment and software. Nonresidential fixed investment jumped 16.3 percent after a 10.3 percent rise in the second quarter.
Federal government spending and rising exports also helped the economy, while inventory investment and falling state and local government spending dragged on growth.
The pace of growth rose as businesses rebounded from natural disasters in Japan and despite uncertainty over the United States’ fiscal outlook and a rolling financial crisis in Europe.
Other reports today may show fewer Americans filed claims for jobless benefits last week.
New claims for unemployment benefits fell slightly last week yet but showed that the labor market is still struggling to find its footing.
About 402,000 people filed for their first week of unemployment claims in the week ended Oct. 22, the Labor Department said Thursday. And that’s just the newcomers to the unemployment rolls.
Another 3.6 million people filed for their second week or more of benefits in the week ending October 15, the most recent data available.
The official unemployment rate currently stands at 9.1 percent.