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U.S. Third-Quarter GDP Grows More Than Expected

Economic IndicatorsOct 26, 2018 08:37AM ET
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© Reuters. U.S. GDP grows 3.5% in third quarter vs. 3.3% forecast

Investing.com - U.S. economic growth slowed in the third quarter, but posted a better-than-expected reading that left the American economy on track to post its best annual expansion in 13 years.

In a report, the Bureau of Economic Analysis said that GDP registered a seasonally-adjusted annual rate of 3.5% growth in the three month period from July to September, cooling from growth of 4.2%, which was the strongest reading in four years.

The reading beat consensus expectations for an expansion of 3.3% and left the U.S. economy on track to register 3% growth for the year as a whole, which would be the strongest outcome since 2005.

In an immediate reaction at 8:35 AM ET (12:35 GMT), U.S. stock futures pared their losses, the U.S. dollar index turned positive, the yield on the 10-year Treasury ticked slightly lower and gold futures decreased their gains.

Although analysts expect the strong expansion to continue in the fourth quarter on the back of recovery efforts following the recent Hurricanes Florence and Michael, most economists expect growth to moderate in 2019 and warn of the possible fallout from simmering trade disputes.

“Escalating trade protectionism could also become more disruptive for the economy as weaker global growth and supply chain tensions lead to softer business sentiment and higher prices through tariff hikes,” ING economists remarked in a note.

U.S. Third-Quarter GDP Grows More Than Expected
 

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FX PL
FX_PL Oct 26, 2018 3:45PM ET
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This title should be:.US Third-Quarter GDP Has Fallen Less Than Expected :)
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Myungsup Kim
Myungsup Kim Oct 26, 2018 11:13AM ET
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When the stimulus is over, economic expansion is over.
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Atleast Maximum
Atleast Maximum Oct 26, 2018 9:20AM ET
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USA will expand from now and will fix past issues with new growth of local industry
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Cristian Chibato
Cristian Chibato Oct 26, 2018 8:49AM ET
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I don't understand why anybody uses analyst opinions as a benchmark for judgment. Deficits are historically high and skyrocketing. Debt is historically high and ballooning. Wage increases are mediocre at best and do little to cushion the impact of tariffs. And cave people are still judging numbers against some random analysts' irrelevant opinions
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Lek Yan
Lek Yan Oct 26, 2018 8:49AM ET
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Coz stock markets are priced based on analyst expectation...
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Tim Youngblood
Tim Youngblood Oct 26, 2018 8:49AM ET
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Chk pres speech on eliminating intl prescription drug subsidies this week
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Scott Halverson
Scott Halverson Oct 26, 2018 8:41AM ET
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trade deficit is the largest ever in US history
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Vince Powell
Vince Powell Oct 26, 2018 8:41AM ET
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It seems economists analyst's and the like do not distinguish between good Gdp and bad Gdp growth. Borrowing to consume imported goods is bad hence an out of control US. budget deficit. This is no reason to feel optimistic. On the horizon is high inflation and then even higher inflation.
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Gregg Sawdy
Gregg Sawdy Oct 26, 2018 8:40AM ET
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rebuilding something that was destroyed is not expansion. That referred to as the broken window fallacy. It's not new wealth, its replacing wealth that was already there.
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Miya Tymya
Miya Tymya Oct 26, 2018 8:33AM ET
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Yes
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