The economy has grown faster than expected. It was predicted to reach 3.4 percent but grew 3.5 percent. Consumer spending, which accounts for more than two-thirds of U.S. economic activity, grew by 4 percent in the third quarter, the strongest since the fourth quarter of 2014.
Inflation was kept in check and consumer spending surged, according to data released by the Commerce Department on Friday.
The PCE price index, a key measure of inflation, increased by 1.6 percent last quarter, much less than the 2.2 percent increase expected by economists polled by StreetAccount. That’s great news.
The growth was propelled by the powerful consumer spending while business spending declined.
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It was slower than the 4.2 percent last quarter.
Overall growth may have been affected, in part, by Hurricane Florence, which flooded the Southeast U.S. in September. The Commerce Department said Florence resulted in losses of $37 billion in property and equipment. Earlier, Moody’s Analytics estimated the economic cost of the storm at $38 billion to $50 billion. And Hurricane Michael, which plowed through the Florida Panhandle and Georgia earlier this month, could affect fourth-quarter GDP.
Barack Obama averaged 2.1 percent growth overall.
The stock market has been highly volatile in October. The earnings are good but revenue isn’t.
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