Thanks to the continued cooling of inflation, consumer spending has generally increased, and the U.S. economy grew steadily in the third quarter.
On Wednesday, the U.S. Bureau of Economic Analysis released data showing that the annualized quarter-on-quarter revision of the U.S. real GDP for the third quarter was 2.8%, in line with expectations and the initial value.
The annualized quarter-on-quarter revision of the core Personal Consumption Expenditures (PCE) price index for the third quarter was 2.1%, lower than the expected and initial value of 2.2%.
The GDP remained robust in the third quarter, mainly due to the strong performance of consumer spending. The report showed that consumer spending grew by 3.5% in the third quarter, although slightly below the expected and initial value of 3.7%, it is still the highest increase this year.
Additionally, residential investment decreased by 5.1% in the third quarter, while non-residential investment increased by 3.8%, both better than the initial values.
Another key indicator of economic activity—the Gross Domestic Income (GDI)—grew by 2.2% in the third quarter, slightly higher than the 2% in the second quarter. GDP measures spending on goods and services, while GDI measures the income and costs generated from producing those goods and services.
Despite the strong resilience shown by GDP, the expansion of the U.S. economy is still tested by stubborn inflation, high borrowing costs, and political uncertainty. Fortunately, the Federal Reserve has begun a rate-cutting cycle, and the process of normalizing monetary policy continues. Next, attention will be on the FOMC monetary policy minutes released tonight.
Meanwhile, with Trump confirmed to return to the White House, U.S. businesses and consumers are now waiting for the economic agenda he will launch next year

Consumer spending grew by 3.5% in the third quarter, the highest increase so far this year

- The U.S. economy showed steady growth in Q3, with real GDP annualized quarter-on-quarter revised at 2.8%, matching expectations.  
- Consumer spending increased by 3.5%, the highest this year, despite a slight dip from the expected 3.7%, while core PCE inflation was revised down to 2.1%.  
- Challenges remain due to persistent inflation and high borrowing costs, but the Federal Reserve has begun a rate-cutting cycle, and attention is on upcoming FOMC policy minutes.

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The actual GDP of the United States in Q3 grew at an annualized quarter-on-quarter rate of 2.8%, unchanged from the initial value, and the PCE price index was revised down to 2.1%