US economic growth in the third quarter was firmer than previously estimated, reflecting upward revisions to consumer spending and business investment.
Inflation-adjusted gross domestic product, or the total value of all goods and services produced in the economy, increased at a 3.2% annualised rate during the period, Commerce Department data showed Thursday. That compares with a previously reported 2.9% advance.
Personal consumption was revised significantly higher, advancing 2.3% in the latest report compared to 1.7% in an earlier estimate and reflecting stronger services spending.
The figures highlight how despite rising interest rates and rapid inflation, consumer and business demand remains solid. A strong labor market and wage growth has underpinned household spending, but it’s unclear whether Americans will be able to maintain that spending momentum into 2023.
Meanwhile, a key inflation gauge — the personal consumption expenditures price index excluding food and energy — rose an annualized 4.7% in the third quarter, up slightly from the previous estimate. November monthly data will be released Friday.
Another key official gauge of activity — known as gross domestic income — rose at a 0.8% rate. When averaged with GDP, a measure watched closely by those who determine the timing of recessions, it climbed a firmer 2%.
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