U.S. economy grows 2.0% in third quarter

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U.S. economy grows 2.0% in third quarter
from MarketWatch.com - MarketPulse
WASHINGTON (MarketWatch) - The U.S. economy grew 2.0% in the third quarter, fueled by higher consumer and government spending and more home building, according to a preliminary government estimate. Economists surveyed by MarketWatch projected gross domestic product would rise to 1.7% from 1.3% in the second quarter. Consumer spending, which has the biggest impact on GDP, rose 2.0% in the July-to-September period, compared to 1.5% in the second quarter. Real final sales of U.S.-made goods and services advanced 2.1%, compared to 1.7% in the prior three-month period. Government spending jumped 3.7%, the biggest increase since mid-2009, mainly because of higher defense outlays. Also, investment in housing surged 14.4%. Net imports, which subtract from GDP, fell 0.2%. Exports dropped a sharper 1.6%. Business investment outside the residential sector fell 1.3%, the biggest drop since late 2009. Inflation as measured by the consumer PCE index rose 1.8%, or 1.3% excluding food and energy. Disposable income moved up 2.6%, but that was down from a 3.8% increase in the second quarter. The personal savings rate fell to 3.7% from 4.0%.