US Economy Advancing Faster Than First Estimated
The U.S. says its economy advanced at a faster pace in recent months than first estimated.
The government’s Commerce Department said Thursday that the American economy, the world’s largest, grew by 2.7 percent in the July-to-September period, a quicker pace than the 2 percent gain it calculated last month. Businesses contributed to the faster pace, boosting their inventories, while the country’s trade deficit narrowed as increased exports outpaced the growth in imports.
The gains in economic activity offset a slower advance in consumer spending, which accounts for 70 percent of the U.S. economy. The government said household spending grew by 1.4 percent in the third quarter, but that figure was down from the previous estimate of a 2-percent advance.
The country’s economic growth could slow in the last three months of the year. Some businesses have cut their investments and hiring, voicing fears that President Barack Obama and Congress may not reach a compromise by the end of the year in order to avert $600 billion in mandated spending cuts and tax increases that would affect all American workers.
Obama, the Democrat newly re-elected to another four-year term, and his Republican opponents in Congress are in the midst of negotiating a new financial plan, but the shape of an agreement has proved elusive.
In a separate report, the government said that the number of unemployed workers filing new claims for assistance dropped 23,000 last week to 393,000. The number of jobless claims had been elevated in recent weeks as thousands of workers were left without work — at least temporarily — because of the severe damage left in the wake of October’s superstorm Sandy along the country’s eastern seaboard.