The US economy grew at an annual rate of 5% in the third quarter, the highest since mid-2003, thanks to the strength of consumer spending and business investment, said today the Department of Commerce.
Thus, the expansion of the US economy between July and September was the highest recorded in a quarter in eleven years.
The third and final calculation of the Government on the development of gross domestic product (GDP) between July and September exceeded the expectations of analysts, who had forecast growth of around 4%, and previous estimates an increase of 3.5% revised then to 3.9%.
The upward revision of GDP growth in the third quarter was due mainly to consumer spending, which grew by 3.2% compared to 2.2% initially estimated.
The consumer spending equals more than two-thirds of economic activity in the country and today the Commerce Department also reported, moreover, that this indicator rose 0.6% in November, which recorded its strongest growth in three months.
Consumers are spending more due in part to lower gasoline prices at lowest since 2010 thanks to the “boom” energy in the US and the global fall in the cost of oil.
Another of the most decisive in the evolution of GDP components, business investment, also performed well between July and September, an increase of 7.7% versus 5.1% previously estimated.
The figures for GDP growth in the third quarter led the Dow Jones Industrial Average, the main indicator of Wall Street, first overcome the 18,000 points shortly after opening.
The chief economic adviser to the White House, Jason Furman, said in a statement that “strong growth” in GDP between July and September is “consistent” with other indicators is showing an improvement in the labor market and in domestic energy production.
Furman also recalled that 2014 was the “strongest” year in terms of job growth since the nineties.
In fact, this year the average monthly job creation of the world’s largest economy stood at 241,000, a level not seen since 1999, confirming the recovery in the labor market after the 2008 crisis.
In November, the unemployment rate remained at 5.8%, unchanged compared with October, and the economy generated 321,000 jobs, the best figure in nearly three years.
Also in the second quarter the economy grew at an annual rate of 4.6%, which offset the contraction of 2.1% recorded between January and March because of a winter that was particularly cold and several snowstorms that paralyzed activities much of the country.
Economists expect growth will slow in the last quarter to an annual rate of around 2.5% and by 2015 will remain around 3%.
Meanwhile, the first rise in benchmark interest rates, which are between 0% and 0.25% since December 2008, is expected by mid-2015.
The Federal Reserve (Fed) concluded last week last session of the year without setting a date for the expected rise in interest rates, although its president, Yanet Yellen, said it was “unlikely” that will occur at least until April.
Following its two-day meeting to discuss the country’s monetary policy, the Federal Open Market Committee (FOMC, for its acronym in English) the central bank said in a statement to be “patient” in determining when it is time to raise rates.
Then Yellen emphasized a press conference that will be the evolution of economic growth and inflation will dictate when rate increases should occur.