Activities in the American economy grew by 2.7 percent in the third quarter compared to the same period last year, significantly faster than initially estimated by the government, according to data released on Thursday.
A month ago, the Department of Commerce estimated growth at two percent. In the second quarter, the economy grew by 1.3 percent.
The estimate for the third quarter was revised primarily due to a stronger increase in business inventories and a surge in exports, which offset weaker personal consumption.
Thus, business inventories contributed 0.77 percentage points to GDP growth, whereas in the previous estimate, the department indicated that they had actually reduced that growth by 0.12 percentage points. Excluding inventories, GDP grew by a revised 1.9 percent, indicating weak demand.
Trade, on the other hand, increased growth by 0.14 percentage points, while in the previous estimate, the department stated that it had reduced it to 0.18 percentage points.
Most economists, however, believe that growth has since slowed and that it will remain below two percent in the last quarter of this year. This is generally considered insufficient to reduce unemployment in the short term.
